Friday, May 18, 2012

Background on OPEC


Thesis: The Organization of the Petroleum Exporting Countries (OPEC) emerged to maximize the profits of selling oil, to respond to the multinational oil companies, and to form a cartel of oil producing countries.

Prior to understanding how did OPEC emerge and how it comes upon to its success, we should start of with “what is OPEC”. OPEC stands for “Organization of the Petroleum Exporting Countries, which was founded in 1960 in Iraq, in which the founding members include Iran, Iraq, Kuwait, Saudi Arabia, and Venezuela. However, this does not include all of the nations that make up the OPEC because later, eight other countries join the OPEC, which includes, Qatar, Indonesia, Libya, United Arab Emirates, Algeria, and Nigeria. Ecuador and Gabon joined OPEC, however they withdrew.

The objective of OPEC is to keep the oil price high and stabilize it, in order a fair price for petroleum producers, which is done by the unification of petroleum policy, that is the producers come together to decide. The organization eliminates the competitive factor between nations that produce petroleum, which will create an efficient economic that will give the investors a good return. If the Baghdad Conference did not decide to create this organization, the price range for oil would be quite variable and may be too expensive. The OPEC is basically a cartel, which is formed to make the price as high as possible, but at the same time stable. The countries in OPEC come upon an agreement that oil shall be sold at a certain price, which helps these investors in making profit. The organization allows the members to be in control of the oil price, in other words it monopolizes the oil market, especially because the product is oil. However, it does not really control since only 41 percent of the world’s oil comes from them, but their oil export represents about 55 percent of oil traded internationally. Oil is valuable because of the fact that it has a limited amount, which is why it is the perfect merchandise to cartelize.

            OPEC was a response to the multinational oil companies, whom tried to cut the price of oil in order to gain back their profit. What really ignited the formation of OPEC was when British Petroleum cut the oil price the second time because the first time had already condemned the oil exporting countries. The history of how the five top oil-exporting countries came together dates back to World War II. Before World War II, there were oil producing countries and the companies, and the reason the oil producing countries were not independent was because of the fact that it had many disadvantages, such as technology, networks, and exploration skills. Being independent was hard for oil producing countries because they did not have fun, which made they struggle to compete with the international market. Venezuela was one of the first country to start negotiating with the companies, in which the “fifty-fifty principle” was their first agreement in 1943, however as they started to demand more, the oil companies moved to cheaper countries. In response, Venezuela advised Arabs to work out the same type of a contract.







http://www.wisegeek.com/what-is-opec.htm
http://cnre.vt.edu/lsg/intro/oil.pdf

OPEC Timeline and Important Figures





OPEC functions in a simple manner, where each member of the organization has a representative, whom will meet at the OPEC conference. The OPEC conference I the meeting of the representatives, in which is headed by Ministers of Oil and Energy of Member Countries. The conference is held twice a year in March and September, however there are cases where extra meetings can be called. The meeting is generally to discuss the general policy of the organization, recommendations, and to keep up with one another. Aside from that, the meeting is there for the members of OPEC to decide together on how the market is doing and what should they do. The Board of Governors directs the organization, while Secretary General runs it. There are many roles that consist the organization, for example the Heads of Delegation. Each member has its own representative, which are known as the Heads of Delegation. The board of governor is nominated and is in position for two years, like the board of directors in companies. The economic commission is another group of workers, which are like the secretariat of the organization. However, the economic commission operates within the OPEC secretariat, which is responsible for carrying out the executive functions.

OPEC does not have a specify founder because it came out as a union of oil producing countries that established the organization. The notable founder of OPEC is credited to Romulo Betancourt, who was the President of Venezuela and known as the Father of Venezuelan Democracy. The idea of OEPC came from Juan Pablo Perez Alfonso, who was a Venezuelan diplomat, politician and lawyer, in which his idea of creating OPEC came from his study of the Texas Railroad Commission. OPEC was founded in 1960, where Alfonso initiated the start of OPEC. The government of the five founding members met in Baghdad and as a group they discussed methods in order to increase the price of oil and to maximize their profit. As a result OPEC was born.
            The current president of OPEC is Rostam Ghasemi, whom is an Iranian military officer and politician. He took place as the Minister of Petroleum for OPEC since August 3, 2011. He played a huge role in the military, where he was part of the Iran-Iraq war. Not only that, but he succeeded Jafari as the chief commander of the Iranian Revolutionary Guard in 2007. The secretary general of OPEC at the moment is Abdullah Salem El-Badri, who is Libyan. These two positions are extremely important in OPEC, which is why these two individuals should be mentioned if OPEC is mentioned









           

Sources: 
http://en.wikipedia.org/wiki/R%C3%B3mulo_Betancourt
http://en.wikipedia.org/wiki/Rostam_Ghasemi

Events, Effectiveness and Judgement of OPEC





Thesis: The Organization of the Petroleum Exporting Countries (OPEC) shaped its organization politically by controlling the global money flow to the Middle East, economical by maximizing its profit in selling oil and socially by preserved their social culture.

The Organization of Petroleum Exporting Countries did not fully realized how much power they had until the 1973 oil embargo. They realized how much power they had economically and politically as they became aware that oil was a severe weapon that could be used. In 1973, the Yom Kippur War occurred, which was the war between Israel and Arab, where Egypt and Syria launched a surprised attack on Israel. However, Israel received western support, which outraged the Arabs, which led to Iran embargoing oil to America and Western Europe. Later, the king of Saudi Arabia did the same, which led to the dramatic increase of oil price. Because of that, the oil price quadruple from about 3 dollars to 12 dollars, which made the government imposed rules in order to conserve oil.

As seen in the 1973 oil embargo, OPEC holds a lot of power because of the fact that it has a huge influence on the oil price, which leads to the discussion of how powerful this organization, is in affecting the world. On a scale of 1 to 10 of importance, OPEC would probably receive around a 10 for being one of the most important organizations that influences the world. The objective of the organization is to stabilize international oil price, which benefits in eliminating competitors because the members of OPEC are among the largest oil exporters. OPEC operates in the manner, where they control the oil production rate as a team in order to correspond to the world’s need and the world is dependent on oil, which is what makes the organization powerful.

The demand for oil has a wide range from every individual to large industrial, because oil covers a large ground of necessities, such as fuel. The way OPEC influences fuel price is not a cause and effect relationship, however it is rather an indirect relationship. OPEC is able to control the production rate of oil, which puts it indirectly in control of fuel. Based on the previous statement, we can see where this is going because most of the things in the world are based on fuel, such as cars. Not only that but agriculture relies on oil because the equipment in order to run a commercial farm are petroleum based, which affects the revenue of running the farm. So if hypothetically, the oil price were to rise, then the price of commercial crops would raise at the same rate because the investors want to make the same amount of profit or even more. Therefore, OPEC has an affect on global food production. Because OPEC influences the global food production, OPEC influences consumer products as well, because if the price of food rises, it gives an excuse for any industry to increase their price.

A sophisticated way this kind of money allowed them to maintain the social control that had always existed, which was how OPEC affected the social aspect of its members. Even though imperialism is no longer around, but there are countries with power that wish to dominate the weaker countries, in order to gain resources. Hence, it is still around, however it was not like what it was before. OPEC allows its members to get a hold of power in the world, which made them less likely to be a victim. Before OPEC existed, oil producing country were not treated as fair, but as soon as they realize that the resource, oil, they have can give them power, they created a union, the OPEC, How this affects the culture of the OPEC members, middle east culture, is that it allows them to prevent foreign countries, especially the western world, from suppressing them. Owing to the fact that oil was such a valuable, a finite product, and most of the things in the world is oil dependent, they made numerous powerful countries dependent on them. This gave the Middle Eastern countries, OPEC, a barrier against cultural suppression, but how long would this barrier last because oil is a finite product.





Thesis: The Organization of Petroleum Exporting Countries is effective in regard to its action and agenda, which is evidentially proven through the influence it contributes to the world, the success in fulfilling its purpose and the power it has in termx so of political and economical means.


Based on historical events and how OPEC dealt with them, we can discuss the effectiveness of the organization. To state that the organization is excellent, we would have to view it’s the objective of the government and was it successful in its goal. I believe, yes, OPEC was substantially successful. If you come to think about it, OPEC became an oil cartel. Even though, most of the oil in the United States comes from Canada, OPEC still makes up 44% of the oil market. This is a primary reason, why we could justify that the organization iseffective. On top of that they made the price of oil worth more, despite its nature of being finite, the union maximized its profit, which allowed them to make the global money flow to middle east. They also managed to use oil in political means. One of the biggest events in the world that OPEC was involved with was the 1973 oil crisis. So from being just a cartel, they became one of a political force. The question is whether oil is still a product or a weapon.

Even though, OPEC seems to be an effective organization, however there are still long term problems that they will eventually have to deal with. Like most organizations, OPEC has its own problems, especially with the Non-OPEC members’ production. Because OPEC makes up only 41% of the oil export, Non- OPEC members are their competitors. The other problem OPEC faces is as the world becomes more eco-friendly, the demand for oil would decrease and as a result OPEC members would be losing money.

OPEC was affected by the collapse of other cartels due to the fact that there were substitutes for the product (of the other cartel) or the certain product had a lot of producers, which gave the consumer a wide range of choices. This prevented products such as coffee to monopolize, which made the cartel looked harmless. This was why OPEC was only effective in stopping prices from falling, however they were not successful in raising the oil price. However, nature supported oil cartelizing because there are only a limited number of suppliers. In the first decade, the organization was caused by a variety of reasons, which includes, OPEC’s production was only 28% of the world’s production, limited power, oil exporting countries were desperate, and there were political divisions in the Arab world. OPEC’s production made up only 28% of the world’s production gave OPEC a disadvantage in monopolizing the oil market, because that’s less than 1/3, therefore the buyers can easily alter their oil producers. This was why they could not increase the oil price in their first decade.

The second reason was that OPEC had limited power because the oil in the ground did not belonged to them, however it belonged to the multinational corporations. This affected on their decision making because the oil was not theirs, so they cannot make rational decisions. However, out of the members of OPEC, Iran was the only member that had oil, which belonged to them. The other reason why the power remained limited was that the oil exporting countries needed a fund to develop the economy. However, they did not have that much, which made them desperate. The political reason why OPEC’s power remained constricted was because of the political divisions. The Middle East was not quite united because Iraq kept threating Kuwait that they will invade. The Saudi Monarchy was not the best companions with Nasser and the Saudi Arabia were competing with Iran for who leaded the Middle East.


Thesis: The Organization of the Petroleum Exporting Countries (OPEC) had a huge impact on the world by hurting third world countries in the oil crisis, becoming a foundation for the world to depend on, and emphasize the value of oil.

            Believe it or not that OPEC had a huge impact on third world countries, in a negative manner. During the 1973, oil crisis OPEC basically made an oil embargo on the United States because they were supporting Israel when Israel was in a war with Saudi Arabia, Egypt, and some other OPEC members. The United States action upset various political leaders of the Middle East, which was what led to the oil embargo. In respond to the embargo, the government in the United States emphasized and made temporary laws on the usage of petrol, such as only certain cars can refill their petrol on certain days. They could not afford risking the chance of not having petrol because petrol runs from businesses to any motor bicycle. Therefore OPEC had a huge impact on all the nations because things in the world are energy based, and most of the energy comes from oil.

            In the 1970s, third world countries were heading towards developing themselves, in order to become a second world country and eventually a first world country. The process undergoes drastic changes that would take a lot of time, based on the industrial revolution in England. The third world countries are looking forward in establishing the same thing that England did, however they are just doing it later. The process requires many key components and one of them is resource. England managed to obtained sufficient and even superabundance resources because they imperialize, which gave them lots of colonies. These colonies were allies and they played a huge role in assisting the Brits to industrialize. In terms of the English industrial revolution, India was one of the most famous colonies that helped the Brits.

            So how the previous two paragraphs correlate with each other. To answer the question, we have to understand the position where the third world countries stand and where do first world countries stand.  Third world countries make shipments and trade with first world countries, however all these shipments would be cut down and even cancelled because of the oil embargo. The first world countries can no longer make trades, if their own country is in jeopardy. As third world countries, they are at the developing stage and food supply is required in order to progress in industrializing. The other key aspect is that the development of the countries is all energy based and the oil is one of the most primary sources of energy. Third world countries are affected also because the embargo did not just include the United States, since OPEC decreased their oil production rate. With oil supply cut off and the fact that most of the countries are oil dependent, they were forced to stop helping the third world countries. First world countries gave loans and supported the third world countries in developing, however they can no longer do this. As a result, OPEC’s decision killed millions of people through starvation.
           
            Regarding the fact that oil is such a power weapon, there was one thing that keeps OPEC from actually dominating the world. The one-reason lies in the term “bank” Arabs do not have banks to put money into and as a result, they store their money in European banks. Keeping in mind that one of the day that first world countries support third world countries is by loaning money, the money that is stored by the Middle Eastern countries are loaned to the third world country. This money flow keeps OPEC away from being a more powerful organization than it already is. Their limitations also included their religion, which was Islam. The Quran forbid a lot of banking institutions. However, even though OPEC faces these obstacles, oil is still dependent. The concept of petrodollars then emerged from the fact that oil is such a dependent finite product. Petrodollars became an idea where money that is based on oil.





Sources:
http://cnre.vt.edu/lsg/intro/oil.pdf
http://www.quoteoil.com/oil-imports.html
http://teacher.scholastic.com/scholasticnews/indepth/upfront/features/index.asp?article=f100410_OPEC

Tuesday, April 3, 2012

Moral Relativism


Moral Relativism
Moral relativism is an interesting idea to investigate, in which it is the idea that  you can change your morals depending on the situation, in which is applied to modern technology, inventions,and philosophy. The key concept in this idea is that people have to make decisions where there is a good side and bad side to things, however each individual has to choose. There are plenty of examples in today modern society, such as experimenting on animals and humans. Scientists use rodents and animals as specimen in order to achieve a scientific breakthrough, however it is not quite right because some of these experiments may cause the specimen to die. The simplest things such as an air conditioner encompasses moral relativism. Air conditioners provides the temperature of our desire, which are extremely useful in humid countries. However, they contribute to global warming. So the question is should we? Another example could be our everyday mode of transportation, cars, cars burn fuel and contributes to global warming, but it allows us to travel at an outstanding rate. So again, the question is should we? And we all know the answer to the question because a large proportion of the world owns a car and an air conditioner. There is quite a conflict in the idea because what people believe varies from one culture to another.

In my opinion, the concept is inevitable because we all have dilemmas in terms of right and wrong. However, what everyone of use encounters in terms of moral relativity is not as intense as the ones scientists, researchers, and philosophers encounter. If you think about it, what the decision these three occupations make decisions that result as an ecological change in the entire world. In accordance to that, we have to understand that when choosing, it is not always all good because after all it started as a dilemma. Therefore, in terms of moral relativism, when choosing the right or the wrong thing, we are weighing things out and choosing the best option.

Thursday, March 22, 2012

Infographics: Textile



Reflection:


In the process of making an infographic, there were numerous difficulties since none of us knew how to make infographics. When we created the infographic, researching was the least of our problems because what was really hard was actually creating the infographic. Now, when you look at an infographic, you can easily understand it due to the fact that it is well organized. As a matter of fact, planning out how the infographic would look like was one of the struggles we had. Anyone would know that people do not like to read large chunks of information, which why the infographic is useful. So we had to think of a technique in order to compress the large chunk of information into something more eye friendly. This is the purpose of creating an infographic. Honestly, I would have to admit that writing a lengthy essay would be easier than creating an infographic. My group was outstanding creative, which is good but bad at the same time because we had a lot of ideas. At first, we planned to use this website called “Piktochart”, however everything disappeared after a third of the work. In our first inforgraphic, we decided to make 15 small sections for the 15 things to know, which was neat. We also had another idea of placing pictures of 15 individuals and each individual say the 15 things we need to know. But because it disappeared, we decided to use a website called “Glogster” to avoid further accidents. “Glogster” is different from “Piktochart” since it was more like a collage. We decided to make our 15 points and connect them to one another through arrows. Each point then has visual enhancements and small notes tagged along in order for the audience to understand. One of the funny things was that each member of the group wanted a certain style, so it took a while to finalize and we found some common ground.
In my opinion, I would say that this infographic on Textile is quite valuable because the medium has important information on textile and its history that could be easily understood. For example, the hemp conspiracy is an odd topic that many individuals do not know. Hemp was one of the first material used to make textile, however its alternative name is cannabis, in which was used by many individuals to intoxicate themselves. I admit that partially the reason why I said my infographic is valuable is because my group putted a lot of effort in it. Our group worked really hard in order to accomplish the task. We started off with researching information about textile and its history, which was the easiest part. Then we had to come up with an idea of how the final product should look like. With four members on the team, there were a lot of ideas, but we finally came up with one and started making. However, the infographic disappeared, so we had to start a new one. The process in creating the infographic was not easy because it involved a lot of clicking and changing tabs.
Infographic informs the modern day technology owing to the fact that it shows how far technology has gone. Back in the days, textbooks and books were the source of knowledge, however as computer and Internet emerged, information became more digital yet it was still reading long bodies of paragraphs. Infographic starts to emerge, which is a form of information but in a friendly manner. In other words, infographics display the same information, but not in long bodies of paragraphs that would bore us. However, it takes a lot more time and effort in creating an infographic than writing a typical essay. As a result of being visually attractive, infographics become popular nowadays, which is actually a well known fact because no one wants to read huge chunks 


Resources:

Tuesday, February 21, 2012

Purpose of Religion


 Purpose of Religion

Historically speaking, religion has been around for along time and it had been misused before. Back in the days, there were many undiscovered phenomenon and things, which was where religion played a role. As a matter of fact, religion still plays a role today because science does have its own limits. Religion is used in terms of the unknown, such as who created us. However in the 21st century, we have discovered many logical reasoning. So why is there religion?

An anonymous individual once said that we had to create religion to answer fundamental question that we couldn’t answer. Science may be the answer, but it has its limits.  Psychologically speaking, every individual needs something to blame his or her problems on.  Religion gives the perfect answer. For instance, if you were to hit someone and later that day you got hit, the golden rule kicks in. However, religion has to adapt as the world progresses. An excellent example would be the disapproval of the geocentric theory. Copernicus a famous polish astronomer, once proposed a model of the solar system. There are many other individual who have been punished like Galileo. During this age, the European world was being introduced to logical reasoning like Descartes’s “ I think, therefore I am.” The church had to go against many famous ideas because it did not corresponded with the bible, which would ruin the reliability of the church. The church held a huge chunk of power and they were not about to give it up.  As a result of all this, religion had to adapt the new discovery and make it correspond. In fact, the church apologized to the African-Americans, who were affected by racism because the church considered multi-racial relationship as some sort of taboo.

The question should there be religion is quite irrefutable because it is inevitable for religion to not occur. Religion is one of the most organized systems you can ever find. It establishes a concept that “this is what we do, and we know it”. For example, if a man attends church on Sunday, you can confident that he’s Christian. The system creates an impression on things that are either right or wrong, in which things that are wrong cannot be right. For example, abortion in Christianity is always wrong. If you haven’t notice, generally children tend to have the same religion as their parents. Religion is a sort of conformity because you follow other people. There are people who refuse to follow religions, which are known to be as atheist. However, atheism is a result of liberalism in which the United States introduced it during the early 20th century.

There is not really an answer to whether I am for or against religion satisfactory. Religion is predestined; therefore going against religion would be hopeless. Religion however, had made some contributions in human society. It is absolutely safe to say, that religion had enhance goodness in the society. Despite the fact that there are a lot of religions, the fundamental thing about religion is do the right thing.

Thursday, December 1, 2011

Sugarcane's History



Top producer of sugarcane belongs to Brazil. Let's see how they do.


How important are sugarcanes, I would say they're quite important since Christopher Columbus took them to the Caribbean to grow. What's remarkable about sugarcanes is its extraction, sugar, however in present day, 2011, sugar seems to be a run of the mill product. The spice dates back to 326 BC, in which the product was took home from Asia by Alexander the Great on his trip to Asia.  Now, how exactly did sugar spread from Northern Greece to all around the world, as a matter of fact most of it happened before industrialization. The path of sugarcane's history brings up many questions like what created the demand for the product, where was it consumed, how does it impact us, and supply and demand.

Alcohol is popular among many societies in the world now and then, despite its side effects. Generally, if you were watching a movie about pirates, you would see them drinking rum. Rum is a popular alcoholic beverage, in which the process requires fermentation of sugarcanes or molasses along with yeast and water. The demand for rum increases because of its popularity among numerous people, the demand of sugarcane is also increased. This was a major reason in the dispersion of sugarcane, because sugarcane becomes a cash crop.  Sugarcane is consider as a spice, and spices were luxurious items back then compare to salt, since salt allows humans to preserve meat when refrigerators weren't invented. What's most important about sugar is its nutritional value, which maybe surprising because nowadays all our parents try there best to make their children avoid sweets. Back then all that matter was life or death, people didn't have time to analyze and study as much as they do now. However, because carbohydrates break down to sugar and carbohydrate is our main source of energy aside from fat, sugar is a major source of energy. People would chew on sugarcane like gum. And like all of us do, sugar's favorable exotic taste grabs attention to people all around world, because it's sweet. Various dishes were serve such desserts and dishes, especially the Arabs. The term sugar is based on an arabic term, sukkar. Sugarcane grabs most of its attention because of curiosity and as people start to know about them, they spread the word and sugarcanes become a trading product.


Sugarcanes are mainly used as a sweetener and this includes the Polynesians, Persians, Indians and many more. As a result of colonial conquests, sugar is spread throughout the world. For example, Emperor Darius of Persia invaded in India in 510 BC and on his way back he took some of the sugarcane, owing to its sweetness. This was a revolution to food because they only had honey. Later, they were raided by the Arabs and as the progression of raiding continues, sugarcane is passed on and on through raids. Soon people started farming and domesticating sugarcane and within a small amount of time, sugarcane becomes one of the most profitable cash crops. Now the commercial farming of sugarcane mostly owes to the slave, because the free labor made sugarcane plantation possible. What explains most of this is "southernization" because without sugarcane plantations, there couldn't be any shipments and without shipments, sugar wouldn't be spread across the world. As a matter of fact, sugarcane is a major cash crop in the triangular trade.




Back in the days, if you're teeth are decayed, they go away, however now that's the least of our concern if you can afford them. All your parents and all your dentists advise you to avoid sweets because they create cavities. Well most natural sweets are based on sugar and sugar is an extraction of sugarcane, in other words sugarcane partially gave birth to dentistry. We understand from the previous paragraph that sugarcane has become a cash crop and because of the expected massive production needed, more labor is required and at the same time land. The settlements to the New World was mainly purpose because of the land needed for plantations and sugarcane was one of those plantations. Slaves were brought from Africa to work in the New World. Rum started to influence the demand dramatically after it was popular among sailors around the 1650s. Sugarcane came in various forms from liquid to solid, however the product itself started as a poshish luxury and now it has become a cash crop. Everyday all around the world, we see sugar everywhere. Current days sugarcane becomes a source of energy and as a replacement of oil, the demand increases thus the price.


Resources: http://www.sugarindia.com/overview.asp
http://rachel-l-webb.suite101.com/sweet-tooth-for-sugar-a26493
http://www.chewingcane.com/sugarcane_history.html
http://www.kew.org/plant-cultures/plants/sugar_cane_history.html
http://www.tastings.com/spirits/rum.html
http://www.rumshop.net/rumhistory.html