OPEC, which stands for the Organization of the Petroleum Exporting Countries, is best classified as an oligopoly.
Oligopoly is a market structure where a small number of firms dominate the market. In the case of OPEC, it consists of several oil-producing countries that collectively manage the production and pricing of oil. Unlike a monopoly, where a single firm has complete control over a market, OPEC relies on the cooperation of its member countries to influence oil prices and production levels.
This collaborative approach illustrates the characteristics of an oligopoly, as the decisions made by OPEC can significantly impact the oil market, but they do not exert total control as a monopoly would. Additionally, the presence of both OPEC and non-OPEC suppliers creates a competitive environment, further affirming its status as an oligopoly rather than a monopoly or perfect competition.