Conclusion

As I had said before, the oil market is very complex. There are many factors that affect it, and the small details can create huge problems. That is why I choose this topic; it helps us to understand the other side of the story. You see gas prices go up, you know that something has happened. I have learned a lot about what goes on now, and reasons why certain things happen. I hope that you as a reader have learned as much as I have about this topic. I look forward to reading other blogs and learning more about their topics (especially http://pmacworldissues.blogspot.com/).

I hope you enjoyed my blog

Sincerely, B Gronk

The oil market is overstocked

http://www.reuters.com/article/2011/04/17/us-saudi-oil-idUSTRE73G14020110417

This last article is important news that occurred on April 17^th 2011, and it’s about how Saudi Arabia’s oil minister says that the oil market is overstocked. "The market is getting tighter and if it is tighter the price may go up, which may have a negative impact to economic growth," Nobuo Tanaka, the head of the International Energy Agency said. Oil ministers from different parts of the world believe that the oil prices are out of the hands of OPEC (Organization of the Petroleum Exporting Countries). Saudi Arabia’s oil minister says that we are cutting output supply (800,000 barrels per day) in order to send a signal to OPEC about the outrageous prices.

Flash Crash of May 6th

Here is another article I found, this time it’s more about the market itself:

http://www.marketwatch.com/story/oil-market-drop-sparked-by-mini-flash-crashes-2011-05-06

This article talks about the oil market drop on May 6^th 2011, and how it was all because of computerized flash crashes. A flash crash is a quick point where the stock crashes, in this case it was computerized, and that’s what caused the crash. This article shows how a small error or a little problem can cause bigger problems. These series of small crashes caused a huge impact on the society that week, a noticeable difference in prices

Protesting Greenland Oil Rig

http://www.huffingtonpost.com/2011/06/04/greenpeace-greenland-oil-rig_n_871313.html

Here is an article I found (Dated: June 4^th 2011) that talks about Greenpeace activists who sneak onto an oil rig that was drilling in the Arctic. They got on and questioned the oil rig workers about how they are preventing an oil spill from occurring (because with colder waters, the oil is harder to clean up). Greenpeace believes that Cairn Energy is NOT doing enough to prevent an oil spill that has potential to be huge. I believe that if Cairn Energy can do more they should, for two reasons. First, to protect the environment. If there was to be an oil spill there would be much harm done to the wildlife around. Second, to save them a lot of money. If there was a spill due to a lack of security on their part, they will have to pay for all the clean up and the blame is on them. I’m sure that a large oil company would be doing everything in their power to avoid a spill in the first place, so in my opinion I believe that the Greenpeace activists were over exaggerating when saying “Cairn Energy is not taking enough precautions”

 

World War 3

After doing some research on different opinion sites,  I have come to a conclusion that MANY people believe that if there was to ever be a World War 3, one of its main causes will be oil. My opinion on this topic is that I agree with what these people are saying. Going back a couple posts ago, I talked about oil being a commodity, and because it is one, which means that there will be a time where nations will be desperate because there is not as much oil left. Oil is a very powerful tool in our lives today, and every country needs it to keep our life styles running, so if everyone NEEDS this rare oil, everyone will be fighting for it. That’s my personal opinion on that; you can leave your opinion in the comments below!

Oil Prices 2000 - 2011

 

This chart shown above represents the oil prices (per barrel) on the y-axis, and the years on the x-axis. As seen in this chart, there has been a gradual increase from the year 2000 till 2008. In 2008 there was a major drop in prices because there were concerns that demand for energy will drop as the global economy slows. After that 8 month drop the price have been increasing at a greater rate up until today

Why Doesn't the Oil Market Stay Consistent?

Crude oil (Also known as petroleum) is the actual oil that is drilled from the ground. Crude oil is NOT used for any necessities we know of. This crude oil can then become refined and made into gasoline or other products. Crude oil is a commodity, which means it is the same no matter who gets it (Corn, coffee beans, gold and copper are examples of other commodities). Since it is a commodity that means that the price of it will change whenever the world has too much or too little of it. So, whenever any natural or man-made disaster occurs (Ex. BP Oil Spill) the prices of oil will increase because we (as a world) are losing oil, making the oil that we own cost more. An example of this is when the corn prices rose when ethanol (can be produced from corn) became an alternative option for a vehicles fuel. 

Dirty Jobs: Drilling for Oil

This video is from a T.V Show "Dirty Jobs with Mike Rowe" and it shows how dangerous and laboring it is to do the job of drilling for oil.

BP Oil Spill

This oil spill occurred in the Gulf of Mexico on the 20^th of April 2010 and had finally concluded on the 15^th of July 2010. There was a spill that was coming from the sea-floor which caused an explosion. This explosion killed 11 workers and had caused 17 other injuries. The oil had ceased to leak because they had finally capped the wellhead. In the end, it is estimated that there had been 4.9 million barrels (780,000 m³) of crude oil leaked.  This is the largest accidental oil spill in the history of the petroleum industry.  This spill caused extreme damage to the marine wildlife in the Gulf, and greatly affected fishing and tourism.  Even in November, parts of the Gulf were closed for shrimp fishing because there were balls of tar caught in the nets. In January 2011, there were still reports of oil sheen, tar balls, and oil onshore. The U.S government held BP accountable for the oil spill, gave them the clean up charges and other costs.  

More About The Oil Market

The Oil Market is a very complex market to this date; we need oil for just about everything we do in our lives. I'm going to start with the basics, oil endangered natural resource, it is drilled from deep in the ground. A lot of oil comes from under a body of water, considering the land is made up of 70% water, so that is why you hear about oil spills, one of the most recent one is the BP oil spill in the Gulf of Mexico (More posts to come explaining the situation). There are so many things that can go wrong, that hurts the environment so why do we take all these risks? Because we need oil! You would be surprised on how many things use the oil that we get. Oil is used to make plastic, buildings, cars, and even toothpaste! But the more oil we use, the scarcer it becomes, making the oil prices to rise, making the products that use oil rise in price. As I said before, the most noticeable change is the gas prices. About 5 years ago, gas prices were around 60-80 cents per liter. Now, its average is around 130 cents per liter, as you can see that is a huge jump.

Why I Chose The Oil Market

I chose the oil market as a topic because it is an issue that relates to our day to day lives. We can all see how oil is doing by the gas prices, which means that it effects us. If no one is informed about this topic, no one will know how and why prices are sky rocketing. Our world is run by the oil we use.

Libya Crisis Affecting Global Oil Market

This video is a little introduction to how the Libya crisis is affecting nations all around the world, and how the oil is hurting everybody...Enjoy!

Feb 25, 2011