The Price Of Oil, Natural Disasters, Economic Trends And The Lack Of Regulation

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A number of theories have emerged as to why the price of oil has taken a severe plummet since its peak in June 2014. The price of crude oil was around $115 a barrel at in June 2014. By 2015, it had fallen by more than 40% to below $70 a barrel. (Petroff) There has been exhausting speculation over this matter including reasons relating to geopolitics, natural disasters, economic trends and the lack of regulation by the Organization of Petroleum Exporting Countries (OPEC). OPEC is the vicar of oil pricing, but has clearly contributed to the drastic price drop in the past year. The standard of OPEC is to ensure balance in the oil markets in order to secure a proficiently economic and steady supply of petroleum to consumers. (OPEC) In November 2014, OPEC failed to reach an agreement on setting a standard of how much petroleum each OPEC nation could produce, which essentially drove down the price of oil. If all of the countries in OPEC are not mandated to supply a fixed amount of oil, they will produce enough to drive down the price making it comfortable for consumers and importers to buy. This has been part of the issue since the plunge began. This de-regulation creates competition because each oil-producing country wants to set the most profitable price, which requires oil production exceeding the typical OPEC standard. The plummeting prices of oil have created positive and negative effects in different industries. The transportation and industrial industry experience lower
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