Production of Unconventional Energy Resources Puts Pressure on OPEC in Future

OPEC countries has benefited from the increase of oil prices in the past few years. Except the worldwide crisis 2008/2009 the demand of oil from OPEC countries was high stabilizing the cohesion within the OPEC. However, this might change in the future: Worldwide demand may not grow as fast as assumed in actual projections due to reduction of subsidies for oil consumption or other demand restricting changes of energy policy. Supply of unconventional energy (oil sand, shale gas) from non-OPEC countries may increase more as projected. In this case it is possible that demand for OPEC-crude could fall in the long term. In particular, this would affect OPEC-countries with high energy reserves: Saudi Arabia, Iran and Iraq which cannot realize their production potential completely altogether. In that case, Saudi-Arabia could reduce its crude oil production and temporarily accept decreases of oil export revenues. However, the country certainly is not willing to permanently reduce production and thus forego oil revenues. On the other side Iran and Iraq depend on oil export revenues to finance reconstruction. Therefore, in a more stable political environment both countries will strongly increase their oil production and boost oil revenues at the expense of Saudi- Arabia. This conflict of interests threatens OPEC's internal cohesion and its power to control oil prices.