Global inunct Prices:
Demand human face vs Supply Side Factors
THE time when we could count on cheap oil color color and steady cheaper natural gas is clearly ending.1
Dave OReilly, the Chairman of banding Texaco 2
By some estimates, there pass on be an clean of two-percent annual growth in global oil read over the
geezerhood ahead, along with, conservatively, a three-percent natural blood line in turnout from existing reserves.
That means by 2010 we will need on the order of an additional 50 billion barrels a day.3
Dick Cheney, Vice President of US
The motion of depletion in mature oil-producing regions is now becoming a lots more significant factor in
the translate-demand equation.4
Chris Skrebowski, Board member of Oil Depletion Analysis Centre (ODAC) 5
By early 2005, the global oil prices had increased from $10 per barrel (in 1998) to $50 per barrel. The major causes
for salary increase oil prices atomic number 18 stated to be tight sum up conditions, increasing demand and to some extent, financial speculations. The
oil prices are expected to decrease only if the demand side and supply side factors responsible for increase in oil prices
leave office in future. However, some analysts expect the prices to fall to $30-$40 per barrel.
several(prenominal) analysts are speculating a
bubble burst similar to the dotcom bubble and they presuppose that the price would fall as the oil business is basically cyclical
where price tends to fall after attaining a certain peak.
Still, repayable to some major challenges like the depletion of spare production capacity, declining production [Exhibit 1] and
environmental concerns being faced by the global oil industry, the oil prices are expected to remain higher reflecting the
knifelike future of oil buffers. It is reported that the Organization of Petroleum exportation Countries (OPEC) 6 has not invested
significantly in the recent years to increase the buffer stock. PFC Energy7 stated OPEC national interests do not lie in
creating large capacity surpluses that...If you want to start a full essay, order it on our website: Ordercustompaper.com
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