Word: opec
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Dates: during 1980-1989
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...ability to control world events grew smaller and other countries proved increasingly independent, irritation mounted and our taste for cooperation began to wane. Our problems with OPEC, Lebanon, Iran, Libya, and even Japan dramatized the frustrations that seemed to dog us whenever we involved ourselves with foreign problems. Small wonder that the spirit of internationalism began...
Barnes' tenure was relatively brief but superheated. After becoming chairman in 1981, the Harvard-educated lawyer pumped Mellon loans to energy companies in the Southwest and beefed up its real estate portfolio in Dallas and other oil towns. The lending and real estate business foundered along with OPEC: energy-related loans now account for more than half of Mellon's $1.45 billion in write-offs and nonperforming assets. Mellon also has $178 million in repossessed properties, a sixfold increase from what it owned in late 1984. Bad loans to Mexico and Brazil further crimped the bank's strained resources...
...When OPEC and oil prices went south, there were minicelebrations at gas pumps across the Lower 48. In Alaska, as in Kuwait and Dubai, there were rude awakenings. Alaska derives a higher percentage (86%) of its general fund from oil taxes than any other oil-producing state. As the price of a barrel of crude oil tumbled from the high 20s down through the teens to about $9, the state began to run on empty...
When the glut is gone, OPEC will be a formidable force again. Predicts Dallas Energy Consultant Ed Vetter: "Once the OPEC countries got us backed into a corner, they could raise their price with impunity and we would have no way to respond." A recent report by the National Petroleum Council, an industry group that advises the Department of Energy, asserts that by 1990 OPEC will be producing at 80% of its capacity, as compared with 66% today. Historically, whenever OPEC has reached the 80% threshold, it has succeeded in imposing -- and sustaining -- oil-price hikes. The report estimates that...
Whenever the moment of truth arrives, it would seem, the beleaguered U.S. petroleum industry will be in no position to respond to a resurgent OPEC. Fully 75% of all U.S. drilling rigs now stand idle. A total of 806 rigs are currently operating in the U.S., down from 4,530 in 1981. The oil is there for the taking, of course, but it is simply too expensive to get out of the ground. While Middle East producers can find and lift a new barrel of oil for about $1, U.S. companies spend an average of more than...