Oil and gas producers are always busy. They are trying to figure out how to reduce costs when fracing horizontals, work around low natural gas prices, and shift more dollars to oily plays. They are thinking about how to deal with anti-drilling protests.

Politicians are no less preoccupied with energy matters. They are figuring out how to end our addiction to oil, transition to other fuels and wring more money out of the oil and gas industry.

But for now, let’s step back from the daily grind to mark a significant bit of history: the creation in September 1960 of the Organization of the Petroleum Exporting Countries. This event was celebrated at OPEC headquarters in Vienna during an international festival held the last 10 days of September. The Austrian government issued a commemorative postage stamp.

Love it or hate it, 50 years later, we are still hostage to OPEC’s ability to produce a lot of oil in a world where demand keeps rising. In 2009, the 12 member nations produced 42% of the world’s daily supply.

At year-end 2009, OPEC reported having 1 trillion barrels of proved oil reserves—79.6% of the world’s proved total. But it may no longer be true that he who has the gold makes the rules. Through the early 1990s, OPEC did control the price of oil, more or less. But since then, hourly trading on the Nymex has supplanted that price control, sometimes to the chagrin not only of OPEC, but of other producers as well.

In 1960, when OPEC was formed at a meeting in Baghdad, global oil demand was about 20 million barrels a day. Today it is roughly 85 million a day, a fourfold increase. OPEC production has always responded.

The geopolitical crosscurrents swirling around OPEC at its formation were just as compelling then as any we experience today. In 1959 President Dwight Eisenhower imposed an oil import tariff, and British Petroleum (now BP) unilaterally cut the posted price it would pay for oil in the Middle East. In August 1960, Standard Oil of New Jersey (now ExxonMobil) cut the price it paid for Middle East oil, and the other majors followed suit.

That September, representatives of the five main oil exporters met in Baghdad. They were not happy. The five, Iran, Iraq, Kuwait, Saudi Arabia and Venezuela, exported more than 80% of the world’s crude exports at the time, according to the 1991 Pulitzer Prize-winning history, The Prize, by Daniel Yergin.

“They joined together around the premise of cooperation, with a commitment to safeguard their legitimate national interests and to ensure order and stability in the international oil market. There was no fanfare, no glare of major publicity from the international media, just five developing nations setting about the business of defending their legitimate interests,” says the OPEC website.

Ever since then, oil and gas executives have blamed OPEC when oil prices get too low, and governments have beseeched it to produce more oil when the price has been too high.

T. Boone Pickens is but one critic of our oil-import addiction. Recently, he said that based on the latest figures from the U.S. Energy Information Administration, we imported 63% of our oil supply, or 382 million barrels, in August 2010—sending approximately $29.3 billion abroad. While a lot of those greenbacks went north to Canada and south to Mexico, a lot went to OPEC member nations.

R. James Woolsey, former director of the CIA, warned about our dependence on foreign oil in an April op-ed in The Wall Street Journal. “If oil reaches $125 a barrel again, as it did in 2008, then approximately half the wealth in the world—above and below ground—will be controlled by OPEC nations.”

Saudi Arabia has always been the de facto head of OPEC thanks to its vast geopolitical sway—not to mention its 263 billion barrels of proved oil reserves. “Saudi Arabia has been an extremely reliable proprietor of the world’s most critical oil supply…and has generally shown a sympathetic understanding of the interests of the OECD nations,” the late Matt Simmons wrote in his 2005 book, Twilight in the Desert.

Regardless of how oil plays out, this commodity we cannot seem to do without bounces between a ruinous glut and impending famine, says Tom Bower in his 2009 book, Oil: Money, Politics and Power in the 21st Century.

Are you coming to Pittsburgh Nov. 2-4? We hope you can join us there, for the second annual DUG-East conference and exhibition. We have two workshops planned—one on water treatment and recycling, the other on midstream needs for the Marcellus play. There will be 50 speakers, more than 250 exhibitors, and nearly 1,800 attendees. That’s a lot of networking opportunity.

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