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Introduction
Every individual is part of the society, whose well being is linked to the
economy of the country.
Oil plays an important role in the economic growth apart from being a
natural resource of nation.
Governments world over formulate policies and rules to regulate and
oversee the movement of oil – within and outside the country.
Events in the oil industry have chain reaction affecting the life and
livelihood of common people.
Oil companies carry out functions independently but the overall
framework in which they operate is controlled by the government.
Irrespective of activity – upstream or downstream, oil companies have
to obtain the stipulated clearances framed by the government.
Introduction
National Oil Companies (NOCs) are having a key role in the global
petroleum supply chain. Being state controlled they get full support not
just domestically but internationally also.
NOCs own oil fields/reserves and operate refineries making them
integrated players. But their long term plans are in line with the
government’s line of thinking.
Leaving the western countries, in most of the other parts of the hydro-
carbon world, it is the NOCs which are dominating.
In some countries they have monopoly and virtually dictate the
petroleum contracts with counterparties.
Due to government support, the other sectors like ports, railways,
power, roads , financial sector etc work in tandem with them.
National Oil Companies (NOCs)
First ‘oil shock’ in ’73 triggered by oil embargo. Prices shot up from $3 to
$ 12/barrel. World shaken up and took notice of power of OPEC.
Second ‘oil shock’ in ‘79 with Iranian revolution with the ouster of Shah
and return of Ayatollah Khomeini. Prices went from $ 13 to $ 32 per
barrel.
Objectives of OPEC :
Coordinate and unify petroleum policies among member countries in
order to secure fair and stable prices for oil producers
Maintain regular supplies of oil to consuming nations by investing,
operating and maintaining the oil producing network
To achieve fair return on capital invested in the petroleum industry
15 Members – Iran, Iraq, Saudi Arabia, Kuwait, UAE, Qatar Algeria,
Angola, Nigeria, Libya, Gabon, E.Guinea, Ecuador, Venezuela,Congo
OPEC
Escalating social unrest in many parts of the world affected both supply
and demand, although market remained relatively balanced.
Trade patterns shifting with demand growing faster in Asian countries
and shrinking in OECD countries.
OPEC continues to seek stability in the market , enhance dialogue with
stakeholders, cooperation with consumers and non-OPEC producers.
IEA
Some countries have Association status and include Brazil, China, India,
Indonesia, Morocco, Singapore and Thailand.
European Union (EU) also participates in IEA.
IEF
The 72 member countries account for almost 90% of world oil & gas
supply and demand.
There is full awareness among member countries about common
challenges despite diverse interests.
There is increased awareness and recognition of high degree of energy
‘interdependence’ among member countries.
Rather than treating oil as a source of conflict, it should be seen as a
cohesive force underpinning healthy growth of world economy.
This is a far cry from the tense relations that existed between producers
and consumers in 1970s and ‘80s.
IEF Secretariat at Riyadh is headed by Secretary General with an
Executive Board comprising of selected member countries.
EIA