The Middle East has had many impacts on the world throughout recorded history, from the innovative techniques in mathematics, medicine, and engineering that existed in the region around AD 1000 to the early 21st century scourge of extremist-fueled terrorism.
One of the better known aspects of the Middle East is that it is the source of a significant percentage of the world’s oil. However, that dominance from the Middle East countries and other nations that ally with them, such as Angola, Ecuador, and Venezuela, is slowly, but steadily starting to slip away.
The organization that essentially binds twelve nations to control and manipulate the global price of oil, the Organization of Petroleum Exporting Countries (OPEC), which is based in Vienna, Austria, has seen its power and influence diminish somewhat in the mid-2010s.
There are several reasons for this decline, but one of the most influential reasons is the United States, previously one of the world’s most prevalent customers of oil from OPEC, has shifted to become somewhat, if not entirely at this time, self-sufficient with oil production.
Various new technologies and techniques, including the controversial fracking, has led to the United States producing more oil than it imports as of the present time. This has been reflected in the eyes of the average customer in the recent drop in oil prices from above $3 a gallon to below $2.75 a gallon, as well as dropping to as low as below $2.40-2.50 a gallon in some places.
While a welcome sight for commuters, motorists, tourists, and others, the low gas prices may have a cautionary tale with them. Not only do the gas prices reflect an abrupt shift in the supply-demand paradigm, but the gas prices could be thought to reflect a coming threat from OPEC. In other words, OPEC could do something to retaliate against the United States, the rest of the West, and developing and developed nations by decreasing the supply of oil so that it could essentially reassert its force as the global body that holds the reins of power over the supply and demand of oil.
Events in the coming months will show what OPEC and its member states, as well as the United States and other nations, do to reassert power. In other words, the gas prices may not stay as low as they are now for long because of various reasons, including the springtime shift to summer blends, the opposition to fracking in various communities and states, and the actions of OPEC.
In conclusion, if people take the time to understand the influence of oil on the world’s economies, then people will be able to comprehend the importance of keeping their eyes open and following international and domestic news coverage, such as the news about Ebola, the conflict between Russia and Ukraine, and the virulent anti-Western ideologies present in some quarters in the Middle East.
(Photo Credit: Flickr via T.J. McKinney)