If a bunch of food staple producers got together and decided to artificially limit output that results to shortage, that would raise prices. They’d effectively profit more with less. It’s also illegal, so how does OPEC constituents do it?
In: 0
Simple, OPEC are powerful sovereign states which the US and other developed nations have limited ability to regulate.
Internally, many OPEC nations offer heavily subsidised fuel to their citizens so there’s little domestic concern about high prices.
Couple of reasons. One is that it’s a group of countries. Those countries are not subject to the laws of other countries because they’re not *in* those other countries.
The other reason is “what are you gonna do about it”. OPEC is a cartel. Cartels are generally frowned upon or banned in most countries. But what are we gonna do? Say “you’re no longer allowed to sell us oil”? That hurts us more than them.
OPEC isn’t really subject to American antitrust laws.
Most American oil is produced in the west.
Standard Oil was broken up because it was an American company that had grown too powerful, controlling most American oil.
OPEC is the Organization of the Petroleum Exporting Countries. [1] Countries get to write their own laws. Therefore, what OPEC does isn’t illegal because the countries that make up OPEC say it isn’t illegal.
Source:
1. https://en.m.wikipedia.org/wiki/OPEC
Which laws?
US laws like the Sherman Act? The US courts don’t have jurisdiction there.
EU laws? Same issue.
International treaties? There’s no treaty saying you can’t, OPEC would never agree to one, and they’d bust out another embargo if the US tried forcing them to agree to one.
We could try and break up OPEC through use of sanctions and boycotts, but as we have seen with Russia, it’s very hard to suddenly stop dealing with a major supply of oil.
Oil consumers have no mechanism to break up OPEC or inhibit it.
[removed]
What laws? No laws like that actually exist. Despite a good intention, there really isn’t a world wide govt legal authority with any bite. And if there was, we’ll countries certainly have the right to act in their own self interest. Of course they may need to face the consequences.
Countries can do whatever they want. If someone else doesn’t like it, well, they can retaliate. What form that may be in can be what we they want, even war.
Because there’s not really any such thing as “international law”. We all talk about it as if there’s some kind of law above an individual country but the honest truth is that the closest thing we have to that is actually agreements among countries to all pass the same laws.
The countries of OPEC have no laws banning the activity that they are engaged in, therefore there’s no laws being broken. United States law does not apply because these countries are not part of the United States.
Latest Answers