Policy simulation for crude oil production of OPEC countries

This paper presents a policy simulation study for the behavior of crude oil production of OPEC countries, especially oil exporting countries in the Middle East, and its influence on the world energy situation. The policy questions to be examined include: What kind of policy could avoid or postpone the occurrence of “creeping cutback” by OPEC countries, without creating an “eye for eye” type policy? What priorities exist among alternative policies? For this purpose, a policy simulation model written in DYNAMO II has been developed. Policy analyses using this simulator are presented, and the methodological limitations of this approach are discussed.