Crude Oil Prices in UK

Crude oil Prices in UK

Table of Contents
ABSTRACT.....................................................................................................................................3
INTRODUCTION...........................................................................................................................4
TASK 1............................................................................................................................................7
Determinants of prices of crude oil in UK.............................................................................7
TASK 2..........................................................................................................................................10
Effects of government Actions on priced of crude oil in UK...............................................10
Immediate impact of Covid19 on Crude prices in UK.........................................................11
Future impact of Covid19 on prices of crude oil in UK.......................................................11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

ABSTRACT
This documents presents the ways in which crude oil prices are dynamically changing in
UK. There are a number of economical factors which lead to change in price of crude oil. Major
focus is paid on fluctuation of prices in united Kingdom. Income, demand and supply, economic
growth, inflation etc. are various factors that are resulting in movement of crude oil prices. A
number of government actions are resulting in reduction in use of crude oil as it may soon
become a scarce resource. The effect of COVID-19 can also be seen on crude oil prices as less
use of transportation results in low consumption of crude oil in country.

INTRODUCTION
Crude oil can be defined as a naturally occurring and unrefined petroleum product which is
composed by the help of hydrocarbon deposits and the organic materials in environment. A type
of fossil fuel is used in order to produce refined crude oil and it is used to produce a number of
materials such as gasoline, petrochemicals as well as diesel. It can be termed as a non-renewable
resource which explains that it is naturally placed and it is often seen that from the rate it is been
consumed in the world the resource is very limited (Nonejad, 2020). Crude oil is a natural
resource of raw material which is extracted from the earth. It is also one of the global
commodities that is traded in the markets throughout the world. It is used as both the derivative
contract as well as portal. There are a number of economists who agree that crude oil was and
will always be the most important commodity in the world as it is the only primary source of
energy throughout the world.
There were a number of other fossil fuels like coal which have been harvested throughout
time however crude oil was the first which was developed during industrial revolution. A
number of industries used it in 19th century. There were different newly invented machines
which were dependent upon various resources in order to run (Alaali, 2020). The whole world
economy today depend upon fossil fuel and the demand for this resource in the market is very
politically unrest and also there are a number of countries who control the reserve wires of crude
oil. However, the supply as well as demand of crude oil is affecting the prices and profitability of
countries. There are some countries like United States, Saudi Arabia and Russia who are one of
the leading producers of crude oil throughout the world.
The following statistics depicts how Brent crude oil price from 1976 to 2020 have changed
and is now standing at US$39.82 per barrel. Brent is considered to be one of the world’s leading
benchmark for the crude oils including Atlantic basin crude oil. The crude oil has been observed
closely in order to influence the cost at all the stages of production and also have been altered
from time to time for the need of consumer goods as well (Aedy and et. al., 2020). In 2019 the
crude oil prices were significantly down from that of in 2014 which was US$99. However there
have been considerable increase from the average price of US$24.45 in 2001 till 2014. The crude
oil is considered to be sweet light crude oil due to the low quantity of Sulphur which is present in
it. In the North Sea there are a number of different oil blends including the Brent Blend and
Ecofisk crude oil. The maximum price of crude oil per barrel was in 2012 which stood at