Word: opec
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Dates: during 1990-1999
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...global glut that has recently pushed prices to a 12-year low, barely higher in real terms than in 1973. After several days of haggling at meetings in Europe and the Persian Gulf, Naimi finally announced a breakthrough: Iran, Algeria, Venezuela, Mexico and the Saudis agreed to press OPEC (the Organization of Petroleum Exporting Countries) and non-OPEC countries for a 2 million- bbl.-a-day reduction in the flow of crude, a figure equivalent to nearly 3% of world output...
Since World War II, much of the U.S.'s foreign policy has centered on maintaining access to cheap and plentiful oil. This has led us to have greater dependence on nations which we would otherwise have little dealing with. For example, the Organization of Petroleum Exporting Countries (OPEC) has been able to exercise some degree of control over the U.S. and its economy by setting the price of oil, as evidenced by the shortage...
...reliance on foreign oil spawns problems abroad like the morass the nation has been drawn into in the Middle East. In addition to our economic vulnerability to OPEC policy and our morally questionable military entanglements, we contribute heftily to the economies of some quite un-democratic nations in the region with our oil purchases. Oil exploration has also led to other (underpublicized) foreign affairs debacles like the virtual plunder of Ecuador by Texaco and Shell's appalling exploitation of Nigerian oil in cooperation with the despotic government...
What do these insiders see that Wall Street doesn't? Are they thinking that oil prices can fall no lower than they have? Do they know something about OPEC that we don't? No. What these executives see is that their stocks' prices reflect overly pessimistic assumptions by Wall Street--just as those stocks reflected overly optimistic assumptions when many of the same insiders were selling frantically a year ago, for double and triple today's prices...
...From Algeria to Venezuela, countries that were formerly closed to exploration and production by foreign companies are reopening their doors. This hardly means the disappearance of politics and security issues--the Persian Gulf War demonstrates that--but these are not the day-to-day drivers anymore. So even though OPEC governments meet to ratify production cutbacks, it is the market that now has the power...