...it's all about the petroleum field in Tanzania.

REVEALED:Why the oil price is falling

THE oil price has fallen by more than 40% since June, when it
was $115 a barrel. It is now below $70. This comes after nearly five
years of stability. At a meeting in Vienna on November 27th the
Organisation of Petroleum Exporting Countries, which controls nearly 40%
of the world market, failed to reach agreement on production curbs,
sending the price tumbling. Also hard hit are oil-exporting countries
such as Russia (where the rouble has hit record lows), Nigeria, Iran and
Venezuela. Why is the price of oil falling?
The oil price is
partly determined by actual supply and demand, and partly by
expectation. Demand for energy is closely related to economic activity.
It also spikes in the winter in the northern hemisphere, and during
summers in countries which use air conditioning. Supply can be affected
by weather (which prevents tankers loading) and by geopolitical upsets.
If producers think the price is staying high, they invest, which after a
lag boosts supply. Similarly, low prices lead to an investment drought.
OPEC’s decisions shape expectations: if it curbs supply sharply, it can
send prices spiking. Saudi Arabia produces nearly 10m barrels a day—a
third of the OPEC total.
Four things are now affecting the
picture. Demand is low because of weak economic activity, increased
efficiency, and a growing switch away from oil to other fuels. Second,
turmoil in Iraq and Libya—two big oil producers with nearly 4m barrels a
day combined—has not affected their output. The market is more sanguine
about geopolitical risk. Thirdly, America has become the world’s
largest oil producer. Though it does not export crude oil, it now
imports much less, creating a lot of spare supply. Finally, the Saudis
and their Gulf allies have decided not to sacrifice their own market
share to restore the price. They could curb production sharply, but the
main benefits would go to countries they detest such as Iran and Russia.
Saudi Arabia can tolerate lower oil prices quite easily. It has $900
billion in reserves. Its own oil costs very little (around $5-6 per
barrel) to get out of the ground.
The main effect of this is on
the riskiest and most vulnerable bits of the oil industry. These include
American frackers who have borrowed heavily on the expectation of
continuing high prices. They also include Western oil companies with
high-cost projects involving drilling in deep water or in the Arctic, or
dealing with maturing and increasingly expensive fields such as the
North Sea. But the greatest pain is in countries where the regimes are
dependent on a high oil price to pay for costly foreign adventures and
expensive social programmes. These include Russia (which is already hit
by Western sanctions following its meddling in Ukraine) and Iran (which
is paying to keep the Assad regime afloat in Syria). Optimists think
economic pain may make these countries more amenable to international
pressure. Pessimists fear that when cornered, they may lash out in
desperation.

Comment
Updated: December 23, 2014 — 12:47 PM

31 Comments

Add a Comment
  1. I just want to tell you that I am very new to blogging and honestly liked you’re web site. Probably I’m going to bookmark your blog post . You definitely come with great articles. With thanks for sharing your web-site.

  2. It’s difficult to acquire knowledgeable people during this topic, however, you seem like do you know what you’re talking about! Thanks

  3. I simply needed to thank you so much once more. I’m not certain the things I could possibly have carried out without the secrets provided by you on such a area of interest. It truly was the distressing problem in my circumstances, however , seeing the very expert way you dealt with the issue forced me to jump over delight. Extremely thankful for your work and thus hope you recognize what a powerful job you were carrying out teaching the rest thru your website. More than likely you have never got to know all of us.

  4. Thank you, I have recently been looking for information approximately this topic for a long time and yours is the greatest I have discovered till now. But, what concerning the bottom line? Are you certain about the source?

  5. Usually I don’t learn post on blogs, however I wish to say that this write-up very compelled me to try and do so! Your writing style has been surprised me. Thanks, very great article.

  6. hey there and thank you for your info – I have certainly picked up anything new from right here. I did however expertise some technical points using this website, as I experienced to reload the site lots of times previous to I could get it to load correctly. I had been wondering if your web hosting is OK? Not that I am complaining, but slow loading instances times will sometimes affect your placement in google and could damage your quality score if ads and marketing with Adwords. Anyway I’m adding this RSS to my e-mail and could look out for much more of your respective exciting content. Ensure that you update this again very soon..

  7. As I web-site possessor I believe the content matter here is rattling excellent , appreciate it for your efforts. You should keep it up forever! Best of luck.

  8. Thank you, I have just been searching for information approximately this subject for ages and yours is the greatest I have found out so far. However, what in regards to the bottom line? Are you certain concerning the source?

  9. I am going to equipment this evaluation toward 2 designs of folks: present-day Zune householders who are thinking of an improve, and people attempting towards decide in between a Zune and an iPod. (There are other avid gamers value contemplating out there, including the Sony Walkman X, nevertheless I assume this provides by yourself plenty of information and facts in direction of make an mindful preference of the Zune vs gamers other than the iPod line as nicely.)

  10. Great amazing things here. I¡¦m very satisfied to see your article. Thank you so much and i’m taking a look forward to touch you. Will you kindly drop me a mail?

  11. Thank you, I have recently been looking for info approximately this subject for ages and yours is the greatest I’ve found out so far. However, what about the conclusion? Are you positive in regards to the source?

  12. I think this is among the most vital information for me. And i’m glad reading your article. But should remark on few general things, The site style is great, the articles is really great : D. Good job, cheers

  13. I was recommended this website by my cousin. I am not sure whether this post is written by him as nobody else know such detailed about my difficulty. You are incredible! Thanks!

  14. Hey there are using WordPress for your blog platform?
    I’m new to the blog world but I’m trying to get started and
    set up my own. Do you need any html coding knowledge
    to make your own blog? Any help would be really appreciated! https://www.gopetition.com/petitions/essay-dune.html

  15. Wow, wonderful weblog structure! How long have you ever been running a blog for? you made running a blog look easy. The entire glance of your website is wonderful, as well as the content material!

  16. great issues altogether, you just gained a brand new reader. What might you suggest in regards to your publish that you made some days in the past? Any sure?

  17. You completed a number of good points there. I did a search on the matter and found most persons will consent with your blog.

  18. The contemporary Zune browser is surprisingly Great, nonetheless not as optimistic as the iPod’s. It operates perfectly, but is just not as prompt as Safari, and incorporates a clunkier interface. If yourself occasionally application upon using the website browser that is not an issue, nonetheless if you are designing to go through the world wide web alot towards your PMP then the iPod’s larger sized show and much better browser might be necessary.

  19. Hello There. I found your blog using msn. This is a very well written article. I’ll be sure to bookmark it and return to read more of your useful information. Thanks for the post. I’ll definitely comeback.

  20. The Zune concentrates on being a Transportable Media Player. Not a world wide web browser. Not a recreation machine. Maybe within just the upcoming it will do even better in individuals areas, nonetheless for currently it is really a Wonderful way to set up and listen in the direction of your audio and films, and is with out peer within that respect. The iPod’s advantages are its website browsing and programs. If these solid even further persuasive, possibly it is your least difficult alternative.

  21. Magnificent goods from you, man. I’ve understand your stuff previous to and you’re just extremely excellent. I really like what you’ve acquired here, certainly like what you’re saying and the way in which you say it. You make it entertaining and you still take care of to keep it wise. I can’t wait to read far more from you. This is really a great website.

  22. My brother suggested I might like this website. He was totally right. This post actually made my day. You can not imagine just how much time I had spent for this info! Thanks!

  23. Hi there, just became aware of your blog through Google, and found that it is really informative. I am gonna watch out for brussels. I’ll be grateful if you continue this in future. A lot of people will be benefited from your writing. Cheers!

  24. whoah this weblog is fantastic i really like studying your posts. Keep up the great work! You understand, a lot of people are searching around for this information, you could aid them greatly.

  25. It¡¦s truly a great and useful piece of info. I¡¦m happy that you shared this helpful info with us. Please keep us up to date like this. Thank you for sharing.

  26. In between me and my spouse we have owned further more MP3 players higher than the many years than I can depend, such as Sansas, iRivers, iPods (classic & touch), the Ibiza Rhapsody, etc. But, the final handful of years I have settled down in the direction of just one line of gamers. Why? Since I was delighted towards explore how well-designed and pleasurable to seek the services of the underappreciated (and commonly mocked) Zunes are.

  27. Thanks for posting this awesome article. I’m a long time reader but I’ve never been compelled to leave a comment. I subscribed to your blog and shared this on my Facebook. Thanks again for a great post!

  28. Thank you for writing this awesome article. I’m a long time reader but I’ve never been compelled to leave a comment. I subscribed to your blog and shared this on my Twitter. Thanks again for a great post!

  29. Between me and my husband we’ve owned far more MP3 players more than the decades than I can depend, like Sansas, iRivers, iPods (classic & touch), the Ibiza Rhapsody, and many others. But, the past couple of several years I’ve resolved down to one particular line of gamers. Why? Because I was content towards obtain how well-designed and entertaining toward employ the service of the underappreciated (and commonly mocked) Zunes are.

  30. The Zune concentrates on remaining a Transportable Media Player. Not a world wide web browser. Not a game machine. Possibly in the long run it’s going to do even far better in just people areas, nevertheless for at present it really is a Good direction in direction of prepare and listen to your audio and videos, and is without the need of peer in just that regard. The iPod’s strengths are its world wide web going to and programs. If all those good even more powerful, maybe it is your suitable alternative.

  31. This is getting a bit further more subjective, still I substantially prefer the Zune Industry. The interface is vibrant, incorporates added flair, and some awesome options such as ‘Mixview’ that allow by yourself out of the blue perspective related albums, songs, or other buyers equivalent in direction of what you’re listening to. Clicking upon a person of individuals will heart on that product or service, and a different mounted of “neighbors” will arrive into watch, allowing for oneself towards navigate in the vicinity of exploring by very similar artists, music, or buyers. Conversing of users, the Zune “Social” is additionally exceptional entertaining, letting you obtain others with shared preferences and turning into close friends with them. Oneself then can listen to a playlist designed based mostly upon an amalgamation of what all your pals are listening toward, which is on top of that interesting. Individuals nervous with privacy will be relieved in the direction of realize by yourself can avert the community towards looking at your unique listening routines if on your own therefore choose.

Leave a Reply

Your email address will not be published.

Time limit is exhausted. Please reload CAPTCHA.

Tanzania Petroleum © 2016-2017.