Table of contents:
- Dynamics of oil prices in the period from the 90s to the "zero"
- Rise in the cost of energy in the early 2000s
- Global financialcrisis of 2008 and further stabilization
- Prerequisites for depreciation and collapse in December 2014 - January 2015
Video: Dynamics of oil prices: from the 1990s to the present
2024 Author: Henry Conors | [email protected]. Last modified: 2024-02-12 02:54
The dynamics of the cost of oil is among the quantities that affect many economic processes and the political situation in the world. The increase in the cost of a barrel of Brent oil has little effect on demand, since the resource is one of the main ones in the energy sector and cannot be replaced by analogues in the main areas of use.
Dynamics of oil prices in the period from the 90s to the "zero"
In the last decade of the twentieth century, the cost of energy remained stable at about eighteen dollars per barrel. Serious jumps in price were observed only in 1990 and 1998.
In the summer-autumn of 1990, as a result of Iraq's military invasion of Kuwait, the cost of oil increased by twenty-six dollars: from fifteen to forty-one monetary units per barrel. After the completion of Operation Desert Storm, by February 1991, the price stabilized and settled at the level of seventeen or eighteen dollars.
Another fluctuation in value was noted during the Asian financial crisis. Then, in 1998, the price fell to ten dollars, and after a short period of stabilization, it dropped even lower. The minimum value for the period under review was reached on December 10, 1998 and amounted to nine dollars and ten cents.
Rise in the cost of energy in the early 2000s
In the spring of 1999, the price of oil stabilized. A slight increase in price (by two dollars) was noted after the terrorist attack on September 11, 2001. Then the cost went below eighteen dollars. Since 2002, a long and almost continuous increase in the price of a barrel of energy began, which was explained by a list of factors:
- war in Iraq;
- output cuts in UK, Mexico, Indonesia;
- increase in resource consumption;
- Gulf product depletion.
At the end of February 2008, the cost of oil for the first time exceeded the threshold of one hundred dollars per barrel. Since then, the market began to react with a rise in the cost of the resource to every instability in the Middle East. So, against the backdrop of rumors that Israel is preparing to launch an air strike on Iran, the price of oil rose by a record ten dollars in a day.
In July 2008, the price of oil per barrel (the dynamics reflects a jump in peaks) reached an all-time high of 143 US dollars and 95 cents.
Global financialcrisis of 2008 and further stabilization
The economic crisis of 2008 caused a collapse in oil prices. The cost of Brent was thirty-three dollars. Soon, the oil price began to gradually stabilize, finally leveling off by 2010. Against the backdrop of the political crisis in Libya began another rise in prices. The cost of oil has exceeded one hundred dollars. The rise in prices was contained by offsetting supplies from Libya by US strategic reserves.
Prerequisites for depreciation and collapse in December 2014 - January 2015
After the stabilization of the price of energy resources, the dynamics of the cost of oil was estimated by many experts negatively. The reasons for this were:
- prolonged decline in fuel demand in China and the US;
- market oversupply: strong U. S. and Saudi production, resumption of shipments from Libya;
- price dumping by Iran and Saudi Arabia;
- OPEC's unwillingness to come to a common decision on reducing the production of the resource.
In 2014, the cost of oil fell by 51% compared to the same indicator of the previous reporting period. The minimum price of the energy resource in this period was noted on January 13, 2015 and amounted to forty-five dollars per barrel. The dynamics of oil prices stabilized in just a month, but by December 4, 2015, the price decreased again. This time, the cost of the resource dropped below thirty-five dollars.
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