The purpose of this memo is for each country to analyze concisely but thoroughly the strategy they pursued in the game and the rationale for that strategy. An analysis of opecs strategic actions, us shale growth and the 2014 oil price crash prepared by alberto behar and robert a ritz1 authorized for distribution by tim callen july 2016 abstract in november 2014, opec announced a new strategy geared towards improving its market share. Economic models of opec behaviour and the role of saudi. Ritz march 2016 ceepr wp 2016006 a joint center of the department of economics, mit energy initiative and mit sloan school of management. Even those not contracted with calpers health benefits can prefund future retiree benefits such as health, vision, dental, and life insurance. Jaffes research focuses on oil geopolitics, strategic energy policy including. As a step towards better understanding and modeling the world oil market and opec in particular, this paper estimates a dynamic model of the world oil market and tests whether opec countries colluded and whether nonopec countries behaved as price takers or oligopolists over the period 19702004. Opec is losing the ability to control market prices as there are more substitutes. In 1973, when opec proclaimed an oil embargo following u. Two years onwards, opecs market share strategy has done lit tle to lift oil prices the oil. The students develop their own bidding strategies and write a group memo describing their teams strategy for each game. Audit strategy memorandum for the year ending 31 march 2014 we are delighted to present our audit strategy memorandum for city of york council for the year ending 31 march 2014. A reliable tool that helps you create a strategy memo template be meaningful even if this is your first time and if you will be applying it as soon as possible. You can use them as additional references in the making of a strategy memo.
Apr 15, 2020 the california employers retiree benefit trust cerbt fund is a section 115 trust fund dedicated to prefunding other postemployment benefits opeb for all eligible california public agencies. This is a fear continually being expressed by the countries concerned, particularly since the ministerial declaration adopted at the doha conference in 2001 included in its provisions on competition measures condemning hardcore cartels. As a step towards better understanding and modeling the world oil market and opec in particular, this paper estimates a dynamic model of the world oil market and tests whether opec countries colluded and whether non opec countries behaved as price takers or oligopolists over the period 19702004. Feb 25, 2020 opec intensified its oil production cuts in december, the final month before the start of a revamped version of a multinational agreement to prevent a glut. For more, see greenpeace analyses of how lewis powells suggestions have impacted the realms of politics, judicial law, communications and education. Oil price paths in 2017 oxford institute for energy studies. With the exception of recommendationsstrategy, each. Corporate client strategy memo template word document download. One view which prevails is that although opec has survived for more than 50 years, it has had little effect on either the oil price or oil market dynamics.
Countries opec in 1960 after a long tussle with the international oil. Opecs objectives are spelled out in the opec statute, which dates from the earliest days of the organization. In a letter to president trump wednesday, cramer, who represents the united states second. Accounting for market characteristics in particular the sluggishness of demand and supply allows to explain price jumps as rational opec strategies from a narrow economic perspective up and down as well as from political objectives at least up due to the political payoff from standing up against the west. These free samples are ready to be downloaded and customize in word, excel or pdf format.
Students play strategy games to learn about the oil and electricity industries. Examples of policy writing david morse and elena delbanco. Organization of the petroleum exporting countries opec. Opec is committed to safeguarding the privacy of its website users. Bassam fattouh lavan mahadeva january 20 mep 3 oxford institute for energy studies and school of oriental and african studies soas, university of london. If you find papers matching your topic, you may use them only as an example of work. We see the confirmation of the opec put pushing capital back into long.
During the first week of the game, we calculated the collusive outcome for opec as a monopoly. We intend these samplesin most cases, taken from ford school student writingto be considered in conjunction with our memo writing memo, which provides an explanation of each of the sections exampled below. However, the eleven members are united by their common status as oilproducing developing countries. As global strategists, this got us thinking about how to buy stocks based on this plutonomy thesis, and the subsequent thesis that it will gather strength and amass breadth. The opec ministerial conference adopted a comprehensive new long. By accessing this site, you accept that we process certain information you send e.
Opec and its partners led by russia had been expected to maintain their strategy of 1. Our team used strategic calculations based on collusive, noncollusive, hotellings rule, and cheating in order to maximize on profits each period. Opec strategies and prices, new resources, the politics of. An analysis of opecs strategic actions, us shale growth and. To hit a curveball, you have to wait for it to break 1. Our website is a unique platform where students can share their papers in a matter of giving an example of the work to be done. How to break both oils monopoly and opecs cartel guarantee a worse future dependence on the oil cartel as the nonopec nations share of the worlds oil reserves and production further shrinks. Organization of petroleum exporting countries opec. Alternative energy and changes in lifestyle can change the market power of the cartel. Fall 2015 opec strategy memo opec strategy memo each team must submit a nal writeup that describes the details of. Opec strategy game memo united arab emirates period 1 strategy our. Expansion act of 1962 an oil embargo against russia, saudi arabia, iraq and other opec members.
In researching this idea on a global level and looking for stock ideas we also. Opecs longterm strategy provides a coherent framework and consistent vision for the future of the organization. The deal is a measure of just how weak opec, and countries dependent on oil exports in general, have become. There are samples found in the template online for free. Opec a successful cartel a cartel is defined as successful if it is. View homework help opec memo from ebf 484 at pennsylvania state university.
Opec s longterm strategy provides a coherent framework and consistent vision for the future of the organization. However, some are in a course reader denoted reader in the list below or just list a web sites url. Memo terry crain david williams january 21, 2000 computer and printer for webmaster sample memo i need to provide our new webmaster with a computer and printer. Read the latest memo from howard marks and browse an archive of all past memos. Bob rogers has given john mcneil the computer and printer that our previous webmaster had been using. Opec s refusal to lower production seems to be part of a strategy to cut out. The establishment and growth of opec is the history of the growing sovereignty of oil producing countries over their natural resources. Pricing exhaustible resources krautkraemer and toman. Saudi oil minister ali alnaimi, the architect of opecs strategy to regain market share by causing the price of crude oil to plunge, says his plan is working, and data from petroleum research. A typescript pdf copy of the original powell memo, with footnotes, can be downloaded from the greenpeace investigations website. Ultimately, opec would be bound to lose a lot in its sales and relations with its member countries and other countries all over the world. Not long ago, technology broke the power of another strategic commodity. Nov 30, 2016 opec has reached a deal to curtail oil production for the first time since 2008, the oilproducing cartel announced on wednesday. Developments in the oil price in the years preceding the global financial crisis sowed the seeds for the shale oil revolution.
An analysis of opecs strategic actions, us shale growth. Matias bebin rodrigo donoso paul kisiliuk andres pachano inaki ruiz feb2012 page 3 for the case of a fully competitive scenario, we solved using cournots model, where each opec country choose a quantity to produce based on what the rest of the countries and the world. If not, please click here to download your copy of the monthly oil market report. The development of the lts was entrusted to member countries deputy ministers of. Analyzing the shift to a marketshare strategy alberto behar and robert a. Opec memo venezuela opec memo drill baby drill intro. The failure of the united states to establish a longterm strategy that will. Global crude oil prices extended their decline in november last year when the organization of petroleum exporting countries announced its decision to. Cipec opec in action alternatives to opec conclusion. Organization of petroleum exporting countries ashley trott, sam holmberg, sarah wong february 10, 2009 eep 142. The development of the lts was entrusted to member countries deputy ministers of energypetroleum under the chairmanship of hrh. The opec momr provides a detailed analysis of oil market developments, including oil supply and demand levels, and trends in the world economy.
Opec memo opec strategy game memo united arab emirates. The organization of petroleum exporting countries opec is a group consisting of 12 of the worlds major oilexporting nations. He will start work later this year at raymond james financial. Then you could always take the help of this template. Opecs strategy is working claims saudi oil minister. View aims and objectives of opec research papers on academia. Fall 2015 opec strategy memo opec strategy memo each team must submit a. Jan 07, 2019 with strong steps we can mobilize the nation around a real crisis and with a clear enemy opec, a memo.
Mgt 820 energy markets strategy professor erin mansur fall1 2009 3 course plan and reading list september 3. An initial six months of output reductions failed to shrink brimming crude stockpiles around the world. Opec, the organization of the petroleum exporting countries, id an international organization uniting most of the worlds petroleum exporting countries to improve the performance of our website, show the most relevant news products and targeted advertising, we collect technical impersonal information about you, including through the tools of. Accounting for market characteristics in particular the sluggishness of demand and supply allows to explain price jumps as.
In each period, each of the member countries of opec chooses their quantities. Pulling back the mask of saudi oil power the atlantic. Through the collaboration of its member countries, and through cooperative relationships with other international organizations, opec has consistently looked for ways to fulfill its mission of coordinating and unifying the petroleum policies of its member. We examine opec s decision to increase oil production levels and what this means for its member countries. Apr 15, 2020 oil production from both opec and non opec groups are assumed to affect oil prices but, in reality, how exactly do these groups impact oil prices. Alleviating us dependence on opec graziadio business school. We want to wait to buy any dip in oil post june opec, but would not add long deltas in the oil commodity into the event 2.
Memos should be prepared jointly by each group and only one memo turned in per team. May 25, 2017 opec has agreed to extend a deal to cut crude oil production for nine months, sources say. Dec 01, 2016 had opec failed to come to an agreement, prices likely would have nosedived. The steep rise in price from usd 23 per barrel in 2003 to. Will volatility increase with new capacity coming online. Oil markets, midstream and downstream services inform your strategy by answering key research questions. Opec reaches agreement to cut oil production to 32.
Well then, you need to make sure its impressive enough to blow them away. David morse and elena delbanco, ford school writing instructors. Non opec countries producing oil at an increased rate have their independent business moves in the global oil industry rather than are faced with the opec regulations of the market. Game theory perfectly explains why opec members are going. The purpose of this document is to summarise our audit approach, highlight significant audit risks and areas of key. Opec opec s objective is to coordinate and unify petroleum policies among member countries, in order to secure fair and stable prices for petroleum producers. Opec strategy memo the purpose of this memo is for each country to analyze concisely but thoroughly the strategy they pursued in the game and the rationale for that strategy. Wto constitute a threat to the organization of petroleum exporting countries opec2. Opec members national oil ministers meet regularly to discuss prices and, since 1982, to set crude oil production quotas.
The organization of the petroleum exporting countries opec. The opec ministerial conference adopted a comprehensive new longterm strategy lts in vienna on 14 october 2010. Aims and objectives of opec research papers academia. Overview of energy markets opec strategy game introduction us eia. The organization of petroleum exporting countries opec was founded in baghdad, iraq, in september 1960, to unify and coordinate members petroleum policies. Non opec countries producing oil at an increased rate have their independent business moves in the global oil industry rather than are faced with the opec. Environmental and energy economics dartmouth college. These countries correspond roughly to saudi arabia, iran, iraq, kuwait, united arab emirates, venezuela, and nigeria. And as prices rise, non opec production is increasing.
Despite tumbling prices the lowest since 2010 the cartel surprised the energy industry by deciding to keep pumping oil at current levels. Another econometric model for the oil market was developed by robert kaufmann 1994 to integrate the effects of economics, geological, political and environmental changes into the link model. The strategy memo s main purpose is to deliver vital information regarding a strategic plan to members of the team involved in the strategic plan. This paper investigates rationale explanations of opecs strategies. With more substitutes, the demand for oil will be more elastic. The loans indicate that saudi arabia is reaching a breaking point due to low oil prices and saw the need to act, as the opec strategy of focusing on increasing market share is clearly not accelerating the oil market correction. The 10th extraordinary opec and non opec ministerial meeting was held via videoconference, on sunday, 12 april 2020, under the chairmanship of hrh prince abdul aziz bin salman, saudi arabias minister of energy, and cochair he alexander novak, minister of energy of the russian federation. Your download should automatically begin in a few seconds. Economic models of opec behaviour and the role of saudi arabia nourah al yousef department of economics, university of surrey june 1998 1 introduction with the rise of the oil prices in 1973, numerous theoretical and empirical studies were undertaken to analyse the structure of the world oil market and the role of opec. The strategy is prepared every five years by the opec secretariat under the guidance of the deputy ministers of petroleum and energy of member countries. The history of us relations with opec baker institute.
So far, opec has stepped up and become a major player in world foreign aid for developing countries. The 10th extraordinary opec and non opec ministerial meeting concludes. Gcc economics and opec research paper example topics and. In fact, for the price recovery to be sustained in 2017, opec efforts must be met by favourable market conditions in the form of an unexpected surge in global oil demand amid a moderate expansion of us shale supply. Mgt 820 energy markets strategy professor erin mansur fall1 2009 2 readings most readings are available on the class web site. Opec member countries oda has been consistently higher than the u.
Opec is still a significant player on the market, but it no longer possesses the dominant position it once did. August 22, 2018, the american petroleum institute api issued a letter to congress. This coincided with the celebration of opec s 50th anniversary. Depending on enrollment, teams will be 3 to 4 students per team. Opecs oil exporting strategy and macroeconomic instability. The revenues amassed by opec provide a big opportunity for a big role in foreign aid. California employers retiree benefit trust cerbt fund.
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