So it was not cheap oil for years – Politics

So it was not cheap oil for years – Politics

Until recently, price $ 100 per barrel oil seemed to be the experts is difficult to imagine. It was assumed that the black liquid gold will only grow in value. The market is more and more dollars as a result of American policy, the Fed Federal Reserve, and the raw material deposits less and less.

Each repeating that works to defeat the theory of Peak Oil, that is the point of peak production. Now, we just slide down the hill, paying more and more for oil and worrying about what we do at the very bottom.

As a result, prices rose because they were driven by money funds speculating on oil. Trading financial instruments based on oil many times over the actual speed in rough, winding up its price. Suddenly, however, futures contracts for oil investors began to brew in his hand.

What happened? The price of oil broke through the $ 100 limit – this time falling – and is getting lower. On the global markets for crude oil WTI (the so-called. Freshwater Texan) already pay less than 90 dollars., And the most famous Brent (North Sea) costs just over 90 dollars. So cheap it was for years.

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Brent crude oil price in recent months, in dollars per barrel.

This is not normal. Autumn always drożała oil, because the United States, the largest consumer of oil, he did wrestling. A large part of the houses there is oil-fired, what next powerful automotive consumption further enhanced the demand. Also turmoil in world politics, especially subsequent conflicts in the Middle East, common sense should clamber prices. Rather than pushing up.

The Miracle? The world has become resistant to oil fears? No, it’s just the American Revolution Slate began to bring beneficial effects. Americans on a massive scale exploit its reserves of unconventional hydrocarbons. Thanks to the technology of horizontal drilling and hydraulic fracturing squeeze their slate more and more gas and oil. As a result, fewer and fewer imports. A hitherto been the largest importer and consumer of oil: countries use approx. 25 percent. global production. In the field of gas are already independent oil still buy, but it is estimated that they will have to import 20-25 percent. they need the raw material.

This had lead to great confusion in the global oil market. The real and the virtual, because speculating on oil has become more risky. In addition, the global economy is still in a slowdown, so you do not need such large quantities of oil. Meanwhile, the producers of the raw material – extremely dependent on its exports – they must save their budgets. If the price falls, you need more extract and sell. This causes an extra boost declining.

The cartel OPEC plans, although at the November meeting of the decision to reduce production, but enforcement of this provision can be difficult. It all depends on Saudi Arabia. A quick decision beg especially the Russians, who, though not belonging to OPEC, dream of higher prices. For now, save up, increasing production. Depreciating oil beats them double the pocket: because they get less for their raw material, and in addition shrink their revenues from gas exports. Gazprom agreement provide that the price of gas is determined by the price of oil and petroleum products.