Analysis of OPEC price rises
An analysis of both crude and product markets in the period up to the 55th meeting of the OPEC Oil Ministers in Caracas, Venezuela, begins with a discussion of the pre- and post-Iranian crisis that has altered the economic position of marker crude buyers. Before the change in Iranian policy, when Saudi Arabia dominated the oil-producing scene, marker crude supply was less than the demand. Following the Iranian crisis the price of marker crude was too low to satisfy the market, even with Saudi Arabian production of crude at an institutional maximum. The result was that buyers were obtaining windfalls when the marker crude price was too low in relation to supply to the market. When Saudi Arabia had to raise the price of their crude, major buyers altered their buying and refining practices. Former seasonal refining and crude purchases to meet product demands were dramatically changed. Because of the subsequent modification of the major's procurement policy (by entering the spot crude market) among other things, a two-tier crude price structure emerged - the State and spot prices. From the fundamental change in the economic structure of the industry the author analyzes the future market structure and the impacts on oil prices and availability in the future. (SAC)
- OSTI ID:
- 5444922
- Journal Information:
- Energy (Aust.); (United States), Vol. 8:1
- Country of Publication:
- United States
- Language:
- English
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Related Subjects
POLICY AND ECONOMY
02 PETROLEUM
OPEC
PRICES
OPE
GLOBAL ASPECTS
PETROLEUM INDUSTRY
IRAN
PETROLEUM PRODUCTS
PETROLEUM REFINERIES
ASIA
DEVELOPING COUNTRIES
INDUSTRIAL PLANTS
INDUSTRY
INTERNATIONAL ORGANIZATIONS
MIDDLE EAST
OIL-EXPORTING COUNTRIES
290200* - Energy Planning & Policy- Economics & Sociology
020700 - Petroleum- Economics
Industrial
& Business Aspects