Oil Issues
- Created by: abaldock
- Created on: 02-10-17 16:12
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- Oil Issues
- Political
- Political instability and repression
- Oil is no longer a scarce resource
- No clear definition between consumers and producers
- Geopolitical tensions lead to lower prics
- Undermining of Russia's oil supply
- USA overtook Russia in oil usage in 2014
- Saudi Arabia is flooding the global market shres of oil
- Climate policies
- Paris Agreement
- Temperature decrease of 1.5 degrees
- Could leave oil as 'stranded assets'
- No longer smart to leave oil because of price fluctuations
- Russia and Saudi Arabia are both producing at full capacity
- Paris Agreement
- Economic
- Goldman Sachs warned that oil was 'even more oversupplied than we had anticipated'
- Two thirds of proven fossil fuel reserves would have to stay in the ground
- Use of low cost oil which is being produced than to waste capital exploring for resources
- Oil is capital intensive and has low operating costs with high profits
- Harder to downscale oil production and costs in the long term
- Trade
- Increased risk of terrorism and violence
- Spot markets
- Fix the oil price and serve as reference prices globally
- Direct exchanges between sellers and buyers
- London market
- Brent barrel price is quoted
- One of the best reference points
- New York market
- WTI barrel
- Political
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