Economist on oil cartel:- Some snippets.
"Such moves by Saudi Arabia may seem reassuring, but in fact they point to a cause for great concern: the real problem with the supply of oil is its concentration, not its scarcity. Fully 25% of the world's proven reserves of oil sit under the parched deserts of Saudi Arabia. Add in four of the kingdom's neighbours, and the share of the world's oil reserves held by Middle Eastern OPEC countries soars to about two-thirds. It is this immutable fact that gives the cartel, and especially the Saudis, all the aces in the energy game. Russia, by contrast, sits atop barely 5% of the world's reserves. (Iraq controls about 10%.) The Arctic reserves in Alaska, which are at the centre of so much controversy in America, are insignificant in comparison.

What is more, because the Middle Eastern suppliers are restraining their production in order to prop up prices, they are sure to have plenty of oil left when the non-OPEC countries start to run out of it. That is why official forecasts, such as those of the IEA, suggest that the market share held by countries in the Middle East—especially Saudi Arabia—can only increase over the next two decades.

All this shows that an approach that focuses on the supply of oil, such as that taken by President Bush, can do little to free the world economy from OPEC's grip. An approach that focuses on demand, however, might be a different story"