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Article on Pricing of Oil- Demand and Supply

   

Added on  2020-05-16

7 Pages967 Words103 Views
RUNNING HEAD: DEMAND AND SUPPLY 1DEMAND AND SUPPLYStudent NameInstitute Name
Article on Pricing of Oil- Demand and Supply_1
DEMAND AND SUPPLY 2ContentsSummary of the situation discussed in article............................................................................3Supply and demand shift factors................................................................................................3Effect on equilibrium price and quantity of the shift factor.......................................................4Reference....................................................................................................................................6
Article on Pricing of Oil- Demand and Supply_2
DEMAND AND SUPPLY 3Summary of the situation discussed in article The article Cbsnews.com, 2016., talks about how the pricing of oil is slowly rising and how the overall demand growth is slowing down. There are a lot of anticipations around the economic slowdown. The studies also suggest that supply from OPEC are functioning at almost near to set standards or record level because main suppliers like United Arab Emiratesare at the highest level (Baffes et al, 2015). The changes in the supply & demand and the overall balance between them has been weighed on the prices of the oil. This new pressure onthe oil prices is further followed by a point of time when oil has been recovered from so many layers covering the low times to become stable. In 2014, the prices of the oil were rising however there was a major crash in price in the start of 2016. This is because of so many factors that hit the prices consisting issues in the overall scale of the current economic slowdown in several countries like China (Juvenal & Petrella, 2015). Supply and demand shift factors There are number of factors that are impacting the oil price in the global market. There is rapid rise in the demand of oil which is of course one of the important factor. Back in the year2004, the IEA (International Energy Agency), reports that demand of oil in world has increased at a fast rate in past sixteen years. There are number of developing nations that are continuing to expand and are more likely to follow the same kind of pattern which is also rising for the overall demand for the energy (Kilian & Murphy, 2014). At the same time there are many oil manufacturing nations that have already undergone so many issues that have further impacted the overall ability to capitalise their complete capacitylike Iraq and Venezuela. There has been a lot of turmoil in Iraq which impacted the production and the violence with low standard manufacturing techniques in the nation previously, have damaged a lot and recovery is challenging (Taghizadeh-Hesary & Yoshino,
Article on Pricing of Oil- Demand and Supply_3

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