OPEC (Organization of petroleum exporting countries) is a swing producer and its decisions have substantial authority on international oil prices. If the OPEC wants to raise the price of oil they simply reduce the production of crude oil due to which demand of oil boosts which increases the price. OPEC member together hold 79%world crude oil reserve and 44% of world production that allow the extensive control of global market. The member of OECD (organization for economic co-operation and development) and post soviet states produce only 23.8% and 24.8% respectively.
OPEC was created in 1960 which include twelve members in this organization. It is the association of oil producer that attempts to enhance the oil price above the competitive level in order to curtail the supply of oil. Its meeting takes place twice in a year in which oil ministers of all twelve countries assemble and make a decision of overall oil output, price and assign quotas of oil to individual member.
Energy consumption is profoundly correlated with the country gross national product and climate. The developed countries are using more energy as weighed against underdeveloped countries. The United States is using 25%of world energy and there is noteworthy growth in China in the utilization of energy resources.
The world is using fuel and energy for diverse rationales. Fuel and energy consumption increases from last two decades as a result of industrial revolution and world population. The observable fact is proved by the reality that China is the largest user of fuel and energy consumption. Its consumption decreased in 2009 due to economic crises in the world. Coal, natural gas, and nuclear now have become the fuels of choice for electricity generation and conservation measures increased energy efficiency.
By and large in world, Industrial users (agriculture, mining, manufacturing, and construction) consume about 37% of the total energy resources. Personal and commercial transportation uses 20%. Residential heating, lighting, and appliances utilize 11%. Commercial uses (lighting, heating and cooling of commercial buildings, and provision of water and sewer services) amount to 5% of the total. The 27% is lost in transmission and generation of energy resources.
Progress in technology will trim down the oil price because of substitutes that will be available soon. It will also reduce the strain on usage of oil. Different energy resources are available now like nuclear energy is used to meet the electricity demand of the world. There are 436 reactor in the world in which uranium is used. China and Canada are the biggest consumers of hydropower electricity. Biomass, biogas, wind power, solar power and geothermal is also giving out in world energy resources. The long term market forces recommend that the economic power of OPEC will diminish as a consequence of decrease in the demand of crude oil.