1960's Oil Production

    'The petroleum industry during 1959 was characterized by one dominant theme - overcapacity to produce' (Mayhew, 1961). 

    Production increased throughout the world after the Suez crisis. 'The total increase was 6.2 per cent, or 1.2 million B/D, from million B/D in 1959 to nearly 20.8 million B/D' (Mayhew, 1961) in 1960 which was in part due to the creation of OPEC. 

    There were five founding countries who created an organization called 'OPEC (Organization of Petroleum Exporting Countries) in 1960 at the Baghdad conference centre' (WTRG Economics, 2011) to try and control petroleum production and prices for the producing countries..  
The five founding nations were, Saudi Arabia, Iran, Iraq, Kuwait and Venezuela. They were established because 'during the 1960s oil was cheap and consumption in both industrialized and some developing countries was able to increase without the restriction of a price reflecting future scarcity' (Hedley, 1981)

    'Their purpose is to stabilize oil prices and to apportion production in an effort to assure sufficient growth for each area' (Mayhew, 1961) in the organisation. Their aim, apart from stabilizing oil prices, was to secure a stable price for the producers as well as offering an efficient supply of oil. Their main aim was to take on the 'Seven Sisters' cartel and by joining OPEC they were able to do this to an extent by managing to retain a 65% stake in the profits from the selling of petroleum. 

    However, despite the creation of OPEC, unfortunately they didn't have a huge control over the bigger oil companies until the oil crisis of the 1970s. Although in 1965, for the first since time since global production had started, the Middle East produced more oil in one year than the US which would prove a particularly important in future years.


Here is an interactive map showing the countries of OPEC and showing when they joined. It shows the five starting member countries, ending with 11 countries in  2011. 

Organization of Petroleum Exporting Countries