Table Of ContentOUP CORRECTED PROOF – FINAL, 18/06/19, SPi
THE RISE AND FALL OF OPEC
IN THE TWENTIETH CENTURY
OUP CORRECTED PROOF – FINAL, 18/06/19, SPi
OUP CORRECTED PROOF – FINAL, 18/06/19, SPi
The Rise and Fall
of OPEC in the
Twentieth Century
GIULIANO GARAVINI
1
OUP CORRECTED PROOF – FINAL, 18/06/19, SPi
1
Great Clarendon Street, Oxford, OX2 6DP,
United Kingdom
Oxford University Press is a department of the University of Oxford.
It furthers the University’s objective of excellence in research, scholarship,
and education by publishing worldwide. Oxford is a registered trade mark of
Oxford University Press in the UK and in certain other countries
© Giuliano Garavini 2019
The moral rights of the author have been asserted
First Edition published in 2019
Impression: 1
All rights reserved. No part of this publication may be reproduced, stored in
a retrieval system, or transmitted, in any form or by any means, without the
prior permission in writing of Oxford University Press, or as expressly permitted
by law, by licence or under terms agreed with the appropriate reprographics
rights organization. Enquiries concerning reproduction outside the scope of the
above should be sent to the Rights Department, Oxford University Press, at the
address above
You must not circulate this work in any other form
and you must impose this same condition on any acquirer
Published in the United States of America by Oxford University Press
198 Madison Avenue, New York, NY 10016, United States of America
British Library Cataloguing in Publication Data
Data available
Library of Congress Control Number: 2019931801
ISBN 978–0–19–883283–6
Printed and bound by
CPI Group (UK) Ltd, Croydon, CR0 4YY
Links to third party websites are provided by Oxford in good faith and
for information only. Oxford disclaims any responsibility for the materials
contained in any third party website referenced in this work.
OUP CORRECTED PROOF – FINAL, 18/06/19, SPi
A Checca, Clio e Margherita,
le mie risorse naturali inesauribili
OUP CORRECTED PROOF – FINAL, 18/06/19, SPi
OUP CORRECTED PROOF – FINAL, 18/06/19, SPi
List of Figures
0.1. La Rosa oilfield in Maracaibo started production in 1922 18
(Shell Historical Heritage & Archive, 190F-00801)
0.2. Plaza de Toros in Juan Vicente Gòmez’s home town of Maracay,
inaugurated in 1933 21
(No known copyright)
0.3. Map image of the1928 Red Line Agreement 29
(BP Archive, ARC117446/001)
0.4. The harbor of Kuwait in 1918, before the beginning of the “age of oil” 38
(Qatar Digital Library, Ref: Photo 496/6/35)
0.5. The Venezuelan petroleum workers’ strike of 1936 45
(https://commons.wikimedia.org/w/index.php?curid=68707021)
1.1. Main hydrocarbon reservoirs in the Gulf 69
(A.S. Alsharhan, “Petroleum systems in the Middle East”, 2014)
1.2. General view of the Abadan refinery in the 1950s (Braim housing
for European expats in the foreground) 80
(BP Archives, ARC 180451/007)
1.3. Protests by Iranian oil workers in 1951. Some of the slogans read:
“Shame on the assassins of the workers . . . Khuzestan”; “Honour to the
petroleum workers of Khuzestan who resisted the tyranny, they have
been killed but did not surrender” 84
(Getty Images, License 50865335)
2.1. Informal settlement for Arab labor at the beginning of the 1950s in
the north of Ahmadi, the “oil town” of Kuwait 97
(KOC Archives)
2.2. El Pentágono Petrolero: the Oil Pentagon. The five sides of the Pentagon,
starting from the top, are: 1. Reasonable participation; 2. CCCCH,
the commission in charge of analyzing production, marketing and prices;
3. No more concessions; 4. CVP, the Venezuelan Petroleum Corporation;
5. OPEC 106
(Juan Pablo Pérez Alfonzo, El Pentágono Petrolero, 1967)
2.3. Manuel Egaña and Juan Pablo Pérez Alfonzo shake hands with Nasser
at the first Arab Oil Congress in Cairo in 1959 112
(Courtesy of Bernard Mommer)
2.4. Heads of delegations to the Baghdad meeting of September 1960
from top to bottom: Fuad Rouhani (Iran), Tala’at al Shaibani (Iraq),
Ahmed Sayed Omar (Kuwait), Abdallah Al-Tariki (Saudi Arabia),
Juan Pablo Pérez Alfonzo (Venezuela) 121
(OPEC Archives)
2.5. Membership of the Petroleum Exporting Countries (OPEC) in1975 123
3.1. Comparative oil production in the Middle East (1948–73) 141
(Petroleum Press Service)
OUP CORRECTED PROOF – FINAL, 18/06/19, SPi
x List of Figures
3.2a. Leaflet from OPEC’s PR Department in 1963 150
(ENI Historical Archives)
3.2b. Leaflet from OPEC’s PR Department in 1963 150
(ENI Historical Archives)
4.1. Peak production and the rise of import dependence in the US.
“Conventional” oil production peaked in 1970; since then the US
has been increasingly reliant on petroleum imports. The new increases
in production in the 2000s are due to “unconventional” oil 190
(US Energy Information Administration)
4.2. The two chief negotiators, Jamshid Amouzegar for OPEC and Lord
Strathalmond for the international oil companies, shake hands after
signing the Tehran Agreement in February 1971 198
(BP Archive, ARC174241/023)
4.3. French President Georges Pompidou addresses chief French negotiator
(minister F.X. Ortoli) during Franco-Algerian oil talks: “What I am
reading Ortoli? Are you willing to compromise on the crucial issue?” 206
(Le Figaro, 6/1/1971. Copyright: Coll. et Cliché Caricadoc)
4.4. The “World Model Standard Run” from the 1972 edition of the Limits
to Growth Club of Rome report shows widespread consensus at the
beginning of the 1970s on swiftly declining resources 212
(The Limits to Growth, 1972)
5.1. Evolution of the official price of Arab Light crude 222
(Ian Skeet, OPEC. Twenty-Five Years of Prices and Politics, 1988)
5.2. Book cover of Arabia Without Sultans by Fred Halliday (1974).
A rich Arab sheik (resembling king Faisal of Saudi Arabia) drowns in oil.
Elites in the Gulf had to respond both to nationalist pressures from
within, as well as to widespread global activism 232
(Copyright Peter Fluck)
5.3. The North–South divide in 1975. OPEC countries were then
considered as the “spearhead” of the G77 developing countries 238
5.4. Houari Boumediene inaugurating the 1975 OPEC Summit in Algiers 249
(Getty Images, license 956645300)
6.1. The bus carrying Carlos (in front to the right of the driver) and his
hostages from OPEC countries to Vienna’s airport, December 22, 1975 256
(AP Images, ID 070125017577)
6.2. The hotel where the “Doha split” OPEC meeting in 1976 took place.
The skyline of Doha was far from the impressive collection of skyscrapers
it is today 262
(AP Images, Id: 534889738499)
6.3. OPEC price increases in the 1970s spur efforts at energy conservation
in OECD countries: a Mini Morris advert of 1980 273
(British Motor Museum)
6.4. Popular representation of the relationship between Western
Europeans and Arab sheiks during the oil price increases of the 1970s 279
(Frankfurter Allgemeine Zeitung, 1979)
OUP CORRECTED PROOF – FINAL, 18/06/19, SPi
List of Figures xi
6.5. At the OPEC Conference meeting in Bali in December 1980,
the Iranian delegate to OPEC sits next to the portrait of the Iranian
Petroleum minister then held captive by Iraqi military forces 299
(AP Images, Id: 98853415334)
7.1. Mass rally of striking miners in Mansfield (UK) in May 1984 309
(The Daily Mail, 3 March 2014)
7.2. The Statfjord B platform in the Norwegian North Sea became operational
in 1982. At the time this “monster” was the world’s largest concrete
platform, testifying to the gigantic financial and technological effort to
develop North Sea oil 312
(https://commons.wikimedia.org/wiki/File:Statfjord_B_(DEX_PR_000829).jpg)
7.3. Increase in non-OPEC oil production from the second half of the
1970s; parallel decline of OPEC output at the beginning of the 1980s 322
(DOE, Annual Energy Review, 1985)
7.4. The rise and fall of oil revenues in selected OPEC countries in the first
decade after the 1973 oil revolution 348
(OPEC, Annual Statistical Bulletin, 1985)
7.5. Historical evolution of crude oil prices 355
(BP, Statistical Review of World Energy)
E.1. International oil rent per family group in Venezuela in the twentieth
century 373
(Asdrúbal Baptista, Teoría Económica del Capitalismo Rentístico)
E.2. National Monument (MONAS) in the middle of Merdeka
(Independence) Square in Jakarta. The other towering building
on the square is the headquarters of the Indonesian national oil
company PERTAMINA 377
(Photo taken by the author)
E.3. Arial view of Abu Dhabi town and the Corniche in 1960 379
(BP PLC and Abu Dhabi National Archives)
E.4. The towering new building of ADNOC (the old ADNOC building
is the small building on the right) on the Corniche of Abu Dhabi 379
(Photo taken in 2018)
E.5. Fire and looting in the center of Caracas during the Caracazo,
February 27, 1989. The official death toll was 300 victims 383
(Photo by Tom Grillo. Archivo Fotografia Urbana, image 127710)
E.6. Global fossil fuels consumption (1965–2005). The graph shows a decline
in petroleum consumption from the middle of the 1970s to the middle
of the 1980s 390
(Simon Pirani, Burning Up, 2018)
E.7. Increasing levels of carbon emissions from fossil fuels during the
Anthropocene 391
(Tyler Volk, CO Rising, 2008)
2
OUP CORRECTED PROOF – FINAL, 18/06/19, SPi
