OPEC Formation

The governments of Saudi Arabia and Venezuela, in accordance with the objectives of the Arab Petroleum Congress of 1959 (1378/79 AH), issued a declaration on May 13, 1960, recommending that petroleum exporting countries pursue a common policy in order to protect their rightful interests.

The declaration also advanced the idea of establishing an organization to achieve this end. Nonetheless, the countries concerned did not take immediate action. It was the sudden and arbitrary decrease in petroleum prices for the second time in 1960 (1379/80 AH) that made them feel the danger which encouraged them to unite in a common front.

Consequently, the major petroleum producing countries declared, after the Baghdad Conference of 10-14th August, 1960 (at which the Kingdom of Saudi Arabia, Republic of Iraq, Iran, Venezuela and Kuwait were represented), their intention to establish the organization which became known as the Organization of Petroleum Exporting Countries (OPEC). One of the major decisions of that meeting declared a cardinal objective of the organization to be the standardization of petroleum prices among its members and agreement on the best methods of protecting its individual and collective interests.

As a result, OPEC was founded in September 1960.

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Profile of Saudi Arabia

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