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8/14/2019 Crude Oil Final
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CRUDE OILCRUDE OIL:: FACTORSFACTORS
AFFECTING CRUDE OILAFFECTING CRUDE OILPRICESPRICES
Presented by:Presented by:
Shweta GargShweta Garg
Sanchit RohatgiSanchit Rohatgi
Farida OsmanFarida Osman
Zeeshan AliZeeshan Ali
Vinay AgarwalVinay Agarwal
Sagun BajajSagun Bajaj
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IntroductionIntroduction
One of the most basic global commoditiesOne of the most basic global commodities
Price fluctuation impacts businesses &Price fluctuation impacts businesses &
IndustriesIndustriesCrude oil prices rose to record147$/BarrelCrude oil prices rose to record147$/Barrellevellevel
Volatility in Stock Markets across theVolatility in Stock Markets across theworldworld
Led to the rise in inflation level globallyLed to the rise in inflation level globally
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33
Factors affecting Crude PricesFactors affecting Crude Prices
Demand
Iraq post-warinsurgency
OPECdecisions
Venezuela Natural Causes
Weather
Crude Oil
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0
10
20
30
40
50
60
70
80
90100
110
120
130
140
150
Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10
(Dollarsper
Barrel)
Forecast
Crude prices often decline justpriorto winter
But did not this
winter
Crude oil prices, having recently exceeded $140 perCrude oil prices, having recently exceeded $140 per
barrel, are projected to decline slowly over thebarrel, are projected to decline slowly over the
forecast.forecast.
Lon -Term Ener Outlook
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Multiple and hard-to-predict factors drive oil pricesMultiple and hard-to-predict factors drive oil prices
Non-OPECSupply Growth
Iran
EconomicGrowth
Inventory
Value ofU.S. Dollar
Chinas Oil Demand
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Dollar-based economies have experienced higher oilDollar-based economies have experienced higher oil
prices than those with other currencies.prices than those with other currencies.
0
20
40
60
80
100
120
Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08
(Dollars/Euros
per Barrel)
$ per barrel
per barrel
$95.39
64.68
ort-Term Energy Outlook
http://en.wikipedia.org/wiki/Image:Flag_of_Libya.svg8/14/2019 Crude Oil Final
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EstablishmentEstablishment --10 Sep,1960 in Baghdad10 Sep,1960 in Baghdad
HeadquartersHeadquarters
ViennaVienna
,,
AustriaAustria
Official language-Official language- EnglishEnglish
Secretary GeneralSecretary General --Abdallah Salem el-BadriAbdallah Salem el-Badri,,LibyaLibya sincesince
January 1January 1,, 20072007))
Total areaTotal area--13,753,061 km13,753,061 km
Expected populationExpected population -619157014-619157014
Organization Of The Petroleum ExportingOrganization Of The Petroleum Exporting
CountriesCountries
http://en.wikipedia.org/wiki/Viennahttp://en.wikipedia.org/wiki/Viennahttp://en.wikipedia.org/wiki/Austriahttp://en.wikipedia.org/wiki/Austriahttp://en.wikipedia.org/wiki/English_languagehttp://en.wikipedia.org/wiki/English_languagehttp://en.wikipedia.org/w/index.php?title=Abdallah_Salem_el-Badri&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Abdallah_Salem_el-Badri&action=edit&redlink=1http://en.wikipedia.org/wiki/Libyahttp://en.wikipedia.org/wiki/Libyahttp://en.wikipedia.org/wiki/January_1http://en.wikipedia.org/wiki/January_1http://en.wikipedia.org/wiki/2007http://en.wikipedia.org/wiki/2007http://en.wikipedia.org/wiki/1_E12_m%C2%B2http://en.wikipedia.org/wiki/1_E12_m%C2%B2http://en.wikipedia.org/wiki/Image:Flag_of_Libya.svghttp://en.wikipedia.org/wiki/Price_of_petroleumhttp://en.wikipedia.org/wiki/1_E12_m%C2%B2http://en.wikipedia.org/wiki/2007http://en.wikipedia.org/wiki/January_1http://en.wikipedia.org/wiki/Libyahttp://en.wikipedia.org/w/index.php?title=Abdallah_Salem_el-Badri&action=edit&redlink=1http://en.wikipedia.org/wiki/English_languagehttp://en.wikipedia.org/wiki/Austriahttp://en.wikipedia.org/wiki/Vienna8/14/2019 Crude Oil Final
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Algeria, Angola, Ecuador, Iran, Iraq, Indonesia,Algeria, Angola, Ecuador, Iran, Iraq, Indonesia,
Kuwait, Nigeria, Libya, Qatar, Saudi Arabia,Kuwait, Nigeria, Libya, Qatar, Saudi Arabia,
United Arab Emirates, Venezuela.United Arab Emirates, Venezuela.
MEMBERS OF OPECMEMBERS OF OPEC
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FUNCTIONSFUNCTIONS
It Coordinates the oilIt Coordinates the oil
production policiesproduction policies
Helps oil producersHelps oil producersto achieve ato achieve a
reasonable ratereasonable rateTry to stabilize theTry to stabilize the
marketmarket Maintaining stabilityMaintaining stability
in oil productionin oil productionApart from this, the member countries alsoApart from this, the member countries alsomeet from time to time to discuss uponmeet from time to time to discuss upon
expected demand for petroleum in countriesexpected demand for petroleum in countries
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Crude Oil: Impact on Indian EconomyCrude Oil: Impact on Indian Economy
Crude & byproducts contributes 14.2% of WPI ofCrude & byproducts contributes 14.2% of WPI of
IndiaIndia
Trading of crude oil is based on SingaporeTrading of crude oil is based on Singapore
mercantile exchangemercantile exchangeMassive losses incurred by Oil companiesMassive losses incurred by Oil companies
because of Government subsidies.because of Government subsidies.
Rise in ATF, led to the booming aviation industryRise in ATF, led to the booming aviation industryplunge southwardsplunge southwards
Huge decline in sales of automobile industryHuge decline in sales of automobile industry
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Crude Oil: Skyrocketing InflationaryCrude Oil: Skyrocketing Inflationary
IndexIndex
Led to soaring WPI commodity prices drivingLed to soaring WPI commodity prices driving
inflation alarmingly.inflation alarmingly.
Inflation rose to above 13% from a level ofInflation rose to above 13% from a level of4.23% in February 20084.23% in February 2008
High input cost for manufacturing industry : theHigh input cost for manufacturing industry : thelargest GDP contributorlargest GDP contributor
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Market balance should loosen as demand growthMarket balance should loosen as demand growth
slows and non-OPEC supply growth increases.slows and non-OPEC supply growth increases.
0.8
1.5 1.6
1.4 1.41.5
0.0
1.4
1.6 1.61.4
1.21.11.2
0.9
1.4
1.1
0.30.2
0.1
3Q2007 4Q2007 1Q2008 2Q2008 3Q2008 2008-
Q4
2009-
Q1
2009-
Q2
2009-
Q3
2009-
Q4
MillionBarrels
per Day
World Oil Consumption Growth Non-OPEC Production Growth
Long-Term Energy Outlook
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THANK YOUTHANK YOU