Tuesday, March 31, 2015

Reason for drop in oil price

About 2 months ago, I did some research on global oil supply. I cannot remember if I've posted something about this. But in any case, I found that it was mainly the increased supply from the US that has caused the increase in the global supply of oil. Many people were going along with the media and blaming OPEC or Saudis for the oil glut. This is yet another classic case that one should always do his/her homework instead of simply relying on the media or hearsay.

Yesterday, Bloomberg came out with an article that confirmed what I've said back then:


"The geopolitics of oil are complicated, but last year's oil crash isn't. There's one reason above all others for the drop in prices: The U.S. oil boom. Last year was the biggest spike in U.S. oil production since at least 1900, according to a new analysis by the Energy Department. 
U.S. production jumped by 1.2 million barrels per day in 2014, to 8.7 million barrels per day."

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