If there was no OPEC would the crude oil be cheaper?
If the member states of OPEC decided to abolish the institution would that be better for the world economy. If there were no OPEC the market forces would set up Crude Oil prices. Each oil exporting country would be competing for the market.
Am I right in saying that without the OPEC the world economy would be in a better shape?
May 5th, 2010 at 2:41 am
You are correct. If you have a cartel that agrees to coordinate prices you don’t have a competitive market. A competitive market typically causes lower prices for the products, compared to what the price would be if there is little or no competition. OPEC cartel members agree on such matters as a fixed price and total industry output. The aim of any cartel is to increase individual members’ profits by reducing competition.
May 5th, 2010 at 2:41 am
America will be screwing allover middle east.