|
The graph of crude oil prices is largely dependent on commodities futures, an investment factor important for investors. From the point of view of investors, they analyze the factors that may affect the value of oil thus buying or selling of oil stakes is done in the futures. Investors juggle three main factors while trading in futures suggestive of the crude oil price they are ready to pay. These include the amount of oil available in storage, the anticipated demand for oil and gas, and the present output of oil. All of these three track the prices on oil therefore determining if, when and how investors should invest. OPEC (Organization of Petroleum Exporting Countries) comprising of 12 highest oil-producing countries controls oil prices around the world, as they are responsible for two thirds of the petroleum supply and half of the oil exports. OPEC makes sure the oil supply is consistent enough assuring that oil prices do not drop drastically as abundant supply means the reverse. A consistent, limited supply also indicates higher prices. However, OPEC is not the only reason behind the crude oil prices. It also depends on demand wherein people buy more gasoline or petroleum for their vehicles indicating the increased use of the liquid. Prices on oil drop when inflation increases resulting in increase on food prices. People generally tend to save money rather than spend thus a consequential drop in oil prices. There are other reasons as well affecting crude oil prices besides supply and demand. It includes global economy and politics that determines the investors thinking to guess the crude oil prices. Economy and politics can influence crude oil prices big time and that too drastically as changing times result in altered thinking of investors who adjust the amounts according to the current events and trends. The failing of global currencies especially US dollar also affects the cost of oil and thus of crude oil prices. Investor trends in spending in a barrel of oil in the future depend on the demand and supply of commodities like sweet crude oil. Increase in cost of oil not only affects related oil related by-products but also cost of other consumer products. Transportation costs are affected thus the need for companies to watch carefully the graph of oil futures to counterbalance their transportation costs. Crude oil pricesoil prices are currently fluctuating due to a weak global economy, European debt crisis and strong dollar and eased tensions in the Middle East. It has resulted in the fall of oil prices, which is around $90 per barrel as of June 2011. The columnist is a veteran writer in oil related fields, who frequently writes articles related to oil prices & indexes and crude oil including tips on investment in oil. Please visit oil.com for more details.
Related Articles -
oil investment, investment in oil, oil investments,
| 
