OPEC is an international organization founded by oil exporting nations Iran, Iraq, Kuwait, Saudi Arabia and Venezuela, on September 10, 1960, in Baghdad, Iraq, for the purpose of coordinating their crude oil market share. The founding members have since been joined by Qatar, Libya, the United Arab Emirates, Algeria, Nigeria, Ecuador and Angola.
At the time of OPEC’s establishment, there were significant volumes of surplus oil on the market, resulting from the development of large oil fields, primarily in the Middle East.
This surplus generated market competition, leading to lower wholesale prices, prompting OPEC's founders to make the unprecedented move of standing up to multinational oil corporations so they could maintain price levels to their satisfaction.
The Conference is OPEC's supreme authority, which meets twice a year. It consists of delegations headed by member country ministers of oil, mining and energy. The Conference formulates OPEC general policy and grants or denies membership in the organization.
The Board of Governors, OPEC’s executive body, meets at least twice a year and is composed of governors nominated by the member countries and confirmed by the Conference. The Board of Governors directs the management of the organization's affairs and implements the declarations of the Conference.
The Secretariat, headed by the organization's chief executive, the OPEC Secretary General, is appointed by the Conference in three-year terms. This position handles OPEC executive functions under the direction of the Board of Governors. Since 2007, this position has been held by Abdalla Salem El-Badri.
The OPEC record-highest basket oil price, defined as an average per barrel price for petroleum blends produced by members, was set on July 3, 2008, at $140.73 per barrel. In the first half of 2014, the OPEC average basket price stood at $96.29 per barrel, compared to $105.87 in 2013.
OPEC’s proven oil reserves currently stand at 1.206 trillion barrels. As of March 2016, oil production by OPEC countries reached 32.25 million barrels per day. OPEC has thus exceeded its own extraction quota of 30 million barrels per day. As of late 2015, OPEC countries accounted for 33.8 percent of global oil output.
The OPEC basket price is a weighted average of prices for petroleum blends produced by OPEC countries. As of May 27, 2016, the OPEC Reference Basket was equal to $44.76 per barrel, while the 2016 average amounted to $34.15, down from $49.49 in 2015 and $96.29 in 2014. The basket price hit its record high on July 3, 2008, reaching $140.73 per barrel.