Managerial Economics (Oil Market Analysis)

Managerial Economics

Contents
INTRODUCTION...........................................................................................................................................3
TASK 1..........................................................................................................................................................3
Describe what happened to oil prices between 1988 and 2018, highlighting different phases..............3
TASK 2..........................................................................................................................................................4
Explain how each of the following economic agents can be affected by the change in the international
price of oil................................................................................................................................................4
TASK 3..........................................................................................................................................................5
Explain how each of the following shocks can impact the demand or supply of oil................................5
TASK 4..........................................................................................................................................................7
Use a suitable demand and supply framework, supplemented with research from economic sources..7
TASK 5........................................................................................................................................................10
Use a suitable demand and supply analysis to make your projections for the international price of oil.
...............................................................................................................................................................10
CONCLUSION.............................................................................................................................................11
REFERENCES..............................................................................................................................................12

INTRODUCTION
Managerial Economics is an economics discipline. Incorporate economic thoughts and ideas
for the study and solutions of business entity and industry management challenges. The
application of economic processes of thinking to evaluate industry trends” issues in international
business are what management economists is all about. Brent oil is currently trading at 76.29
dollars a barrel, up from 73.16 dollars the prior month. The price has increased by 76.43 percent
in the last year (Staples, Malone and Sirrine, 2021). Brent fuel is also referred as London Brent,
North Sea Oil, Brent Blend, and Brent gasoline, and it is derived from of the North Sea. It's a
lighter petroleum that's somewhat lighter than WTI and sweet due to its low sulphur level,
making it excellent for processing gasoline and petrol. The EIA evaluates the many factors that
might impact crude oil prices, including actual economic factors and also trade and global
economy elements. We examine probable links between each component and crude oil prices by
describing the seven major factors that could affect energy markets.
TASK 1
Describe what happened to oil prices between 1988 and 2018, highlighting different phases.
Brent oil is currently trading at 76.29 dollars a barrel, up from 73.16 dollars the prior
month. The price has risen by 76.43 percent in the last year. Brent crude is also referred as
London Brent, North Sea Oil, Brent Blend, and Brent petroleum, and it is derived from the North
Sea. It's a light petroleum that's somewhat lighter than WTI and pleasant owing to its poor
sulphur level, making it excellent for processing gasoline and petrol.
Brent crude oil accounts for nearly half of the worldwide crude oil supplies. Brent blend
crude is used as a reference for oil transactions all over the world. The ICE stock exchange is
where it is exchanged digitally. OPEC's tentative average yearly crude prices for 2021 are 62.031
dollars per barrel. This is a result of the long year's 41.47 US dollars that was just marginally
greater than the standard yearly price mostly during 2016 oil crisis. As during corona virus
pandemic, a substantial drop in vehicle fuel consumption and weaker future situation resulted in
a price drop in 2020. OPEC refers for Oil companies, and Algeria and the United Arab Emirates
are members as of June 2021. The goal of the Organization of Petroleum Exporting Countries
(OPEC) is to manage the oil policy of its membership (Pamungkas, 2020). It was created in