What Drives Oil Prices?
OPEC, or Organization of the Petroleum Exporting Countries, is composed of about 15 nations that produce half the world’s oil supply and house over 80% of the world’s oil reserves. This gives OPEC a huge international edge regarding influence on oil prices.
OECD, or Organisation for Economic Co-operation and Development, is a group of 35+ countries working together to promote international trade. Originating in 1957, the OECD consists of mostly developed countries whose people have higher levels of vehicle ownership than non-OECD countries. Crude oil prices can be affected by various global changes. This includes economic growth, expectations of economic growth, production from OPEC and Non-OPEC countries, ect. Crude oil plays an integral part in the commodity market.
Recent News on Crude Oil
June 22nd, 2018 marked the 174th meeting of OPEC in Vienna. Oil prices rose over 5% after the conference. OPEC released a statement that they are adding one million more barrels per day to their output. Why would a supply increase announcement raise prices? Maybe because a larger supply increase was expected than one million. OPEC nations are currently producing oil at maximum levels, and those levels are falling. The outlook for oil indicates a situation where this shortage continues. President Trump has attempted to get other countries to follow suit with the Iranian sanctions while also pressuring Venezuela.Learn More