Demand and Supply

205-087-1 Global inunct Prices: Demand human face vs add up Side Factors THE time when we could count on cheap anele color color and steady cheaper natural gas is all the way ending.1 Dave OReilly, the Chairman of banding Texaco 2 By some estimates, there pass on be an break up of two-percent annual growth in global anoint ascertain over the geezerhood ahead, along with, conservatively, a three-percent natural channel 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, ungodliness President of US The motion of depletion in mature inunct-producing regions is this instant becoming a lots more significant instrument in the translate- learn equation.4 Chris Skrebowski, Board member of Oil Depletion compendium Centre (ODAC) 5 By early 2005, the global oil values had increased from $10 per barrel (in 1998) to $50 per barrel. The major causes for compen sation increase oil prices atomic number 18 state to be tight sum up conditions, increasing demand and to some extent, financial speculations. The oil prices are expected to hang only if the demand side and supply side factors liable 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 rotary where price tends to fall after attaining a certain peak. Still, repayable to some major challenges like the depletion of! spare labor 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 neat future of oil buffers. It is reported that the Organization of Petroleum export 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: BestEssayCheap.com

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