Trust governments to reconsider their options when confronted with the facts and changing conditions. For a large number of low-income nations, one of the most annoying impediments is the existence of the oil producing and marketing cartel otherwise known as OPEC. This story on the CNN site shows that Indonesia's energy minister has given notice of its withdrawal from the organization by year's end.
This is an interesting phenomenon for the reason that the decision has been made because of the realization that Indonesia's oil supplies are insufficient to meet its internal demand. effectively therefore, it does not make sense for a net consumer of petroleum to be part of an organization that is committed to maintaining prices that allow for the extraction of large rents. To my mind, this reversal proves a couple of points. First, as a long-standing member of OPEC, Indonesia's leaders seem to be convinced that the coordinated action and allocation of supply results in increased prices for petroleum beyond what would be cleared by the market. The second is that it is probably possible to predict the degree of commitment to the organization based on observable factors as the size of reserves versus the domestic demand.
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