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Title: Recent developments within OPEC: economic perspective

Abstract

The main purpose of this paper is to examine the behavior of the OPEC members to determine the reasons behind their conflicts, examining the characteristics of the different members. (These characteristics are: income per capita, expected oil reserve life, absorptive capacity, balance of payments on current accounts, and capacity utilization rate.) Based on these characteristics, subgroupings of OPEC are identified (two sub-groups are formed, the saver group and the spender group). Furthermore, it is established that the saver group has the ability to influence the oil market by the virtue of its special characteristics. Finally, using a dominant firm model of resource allocation over time with a backstop resource (which is taken to be shale oil) in conjunction with the characteristics of the two groups we give economic content to the conflict over the price of oil. It is found that the special characteristics of the saver group combined with its market power result in a pricing policy which is completely different from the pricing policy preferred by the spender group. Therefore, it is concluded that there are more fundamental reasons behind the conflicts over oil price within OPEC than those brought about by cartelization (i.e., incentives to cheat).

Authors:
Publication Date:
OSTI Identifier:
6037762
Alternate Identifier(s):
OSTI ID: 6037762
Resource Type:
Thesis/Dissertation
Resource Relation:
Other Information: Thesis (Ph. D.)
Country of Publication:
United States
Language:
English
Subject:
02 PETROLEUM; 29 ENERGY PLANNING, POLICY AND ECONOMY; OPEC; ECONOMIC ANALYSIS; ECONOMIC POLICY; PETROLEUM; COMPARATIVE EVALUATIONS; ECONOMETRICS; MARKET; ECONOMICS; ENERGY SOURCES; FOSSIL FUELS; FUELS; GOVERNMENT POLICIES; INTERNATIONAL ORGANIZATIONS; OIL-EXPORTING COUNTRIES 020700* -- Petroleum-- Economics, Industrial, & Business Aspects; 294002 -- Energy Planning & Policy-- Petroleum; 290200 -- Energy Planning & Policy-- Economics & Sociology

Citation Formats

Mohammad, Y.H. Recent developments within OPEC: economic perspective. United States: N. p., 1983. Web.
Mohammad, Y.H. Recent developments within OPEC: economic perspective. United States.
Mohammad, Y.H. Sat . "Recent developments within OPEC: economic perspective". United States. doi:.
@article{osti_6037762,
title = {Recent developments within OPEC: economic perspective},
author = {Mohammad, Y.H.},
abstractNote = {The main purpose of this paper is to examine the behavior of the OPEC members to determine the reasons behind their conflicts, examining the characteristics of the different members. (These characteristics are: income per capita, expected oil reserve life, absorptive capacity, balance of payments on current accounts, and capacity utilization rate.) Based on these characteristics, subgroupings of OPEC are identified (two sub-groups are formed, the saver group and the spender group). Furthermore, it is established that the saver group has the ability to influence the oil market by the virtue of its special characteristics. Finally, using a dominant firm model of resource allocation over time with a backstop resource (which is taken to be shale oil) in conjunction with the characteristics of the two groups we give economic content to the conflict over the price of oil. It is found that the special characteristics of the saver group combined with its market power result in a pricing policy which is completely different from the pricing policy preferred by the spender group. Therefore, it is concluded that there are more fundamental reasons behind the conflicts over oil price within OPEC than those brought about by cartelization (i.e., incentives to cheat).},
doi = {},
journal = {},
number = ,
volume = ,
place = {United States},
year = {Sat Jan 01 00:00:00 EST 1983},
month = {Sat Jan 01 00:00:00 EST 1983}
}

Thesis/Dissertation:
Other availability
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