the United States will withdraw from the
Iran nuclear deal actions by the
President of the United States can
impact a lot and oil prices are no
exception for most Americans that means
what the US says it does will impact
what they pay at the pump here's what
drives oil prices world affairs are just
one of many factors that dictate oil
prices if you're in the world of oil
monitoring the ebbs and flows of crude
prices a second nature most investors
either follow WTI or Brent crude Brent
crude refers to oil from certain oil
fields in the North Sea and it's used as
an international benchmark for oil
prices and West Texas Intermediate is
one type of light crude that's drilled
in the US and serves as a benchmark for
US oil prices if you're not an oil
analyst it may seem like a lot to keep
up with but regardless of which of those
contracts you follow the gist is the
same for both oil prices are influenced
by three major factors supply demand and
geopolitics supply and demand just has
to do with how much oil is available and
how badly people want it supply has
historically been determined by
countries that are part of the
organization of the Petroleum Exporting
Countries also known as OPEC but now the
United States is playing a bigger role
in supply thanks to the booming
production from American shale fields so
if major oil-producing countries are
pumping out a lot of oil the supply will
be high just look at what happened in
2014 well prices crashed as producers
pumped more than the world could consume
OPEC was largely blamed for the free
fall in oil prices because it refused to
cut down its production but OPEC said
that US shale drillers were to blame for
pumping too much and that they should
cut their production first in 1973 Arab
members of OPEC put an embargo against
the United States
Hetalia tori measure after the embargo
the oil supply the US was so scarce and
the demand was so high it drove the
price of oil to the point that gas
stations began rationing gasoline demand
on the other hand is determined by how
much need there is for oil at a given
time think of the need for things like
heat electricity and transportation the
more economic growth our region sees the
more demand there will be for oil and
then there's the question of how the
market will react to renewable energy
geopolitics remember how supply is
determined by the big oil producing
countries well if there's tension with
one of those countries like a major war
or conflict it could throw off the
supply of oil which would then alter the
price of it think back to 2003 after the
u.s. invaded Iraq oil prices went up and
with instability in the region people
weren't immediately sure what would
happen to the supply more recently
president Trump pulled out of the Iran
nuclear deal and restored sanctions on
Iran Ian's oil exports oil prices hit
three and a half year highs as traders
tried to figure out how the sanctions
will impact global oil supply
market geo peloton and the environment
the energy industry is sure to evolve
and it remains to be seen what role oil
will play in the future but for now the
oil markets remain a powerful force in
the world of economics geopolitics and
your commuting budget
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