Talk:Price of petroleum

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edit·history·watch·refresh Stock post message.svg To-do list for Price of petroleum:

Here are some tasks awaiting attention:
  • Expand: History section is devoid of anything before 2003 Add information on the link between the price of petroleum and inflation/stagflation
  • Verify: Bulk up on citations throughout
  • Other: Do something with the market listings section, or dump it.

initial comments[edit]

I would add information about price of biofuel and price of electricity. --HybridBoy 08:39, 27 June 2007 (UTC)

When did gas prices begin being priced ending with 9/10 of a cent? Also who started it? CashDude 04:23, 6 August 2007 (UTC)

This article is about petroluem, not gasoline, biofuel, or electricity. Snottywong 23:33, 16 October 2007 (UTC)

I'd be interested to know the recent effects that market speculators have had on the price of petroleum... Snottywong 23:33, 16 October 2007 (UTC)

(30th Dez) I don't think this sentence is completeley right: "Oil price has undergone a significant decrease since the record peak it reached in July 2008. On December 23, 2008, WTI crude oil spot price fell to US$30.28 a barrel, the lowest since the global financial crisis began, and has been trading between US$35 a barrel and US$79 a barrel in 2009. [3]" As far as I know, the price sank to 35$ because of the financial crises, so the words "the lowest since the global financial crises began" are not correct... —Preceding unsigned comment added by (talk) 19:58, 30 November 2009 (UTC)

The price of electricity can be found at Electricity tariff. I think a general "price of energy" article should be started, with info as to the prices of many different fuels. Fiftytwo thirty (talk) 20:14, 24 January 2010 (UTC)

Why so high?[edit]

This statement

Then prices doubled again between 2006 and 2008, this time due to speculation, when US trading was allowed to take place through the US-owned ICE Futures exchange in London rather than the NYMEX, thereby escaping US regulatory requirements. [15] [16]

is totally unfounded. The citations quoted (Williams and Engdahl) are relatively poor, purely-opinionated on the one hand and cherry-picking anecdotal points on the other. Obviously regulatory evasion is someone's axe to grind in writing this. This theory should be expressed as a debate with both sides being quoted. Alternative points of view are that monetary inflation, supply and demand (particularly from Asia), and banking system shock and Federal Reserve actions have more to do with the sharp rise of oil since 2006. --Aaron Krowne (talk) 02:28, 22 July 2008 (UTC)

A lot of commentators know little or nothing about the subject but are willing to commentate at great length. I think the professional analysts have pointed out that the futures market should have no effect on the oil market because they're just betting on future trends. If you bet the farm on a poker game, it shouldn't affect the price of farmland. However, I think I read somewhere that the stages of response to a crisis go something like:
  1. Shock
  2. Denial
  3. Anger/frustration
  4. Search for scapegoats
  5. Depression
  6. Resolution
So, we're at the search for scapegoats stage. The next step is the depression, and then people eventually get around to the resolution stage, in which everyone sells their SUV for scrap metal and buys a hybrid. Wait for it. RockyMtnGuy (talk) 15:48, 22 July 2008 (UTC)

Don't give me that supply and demand stuff. Compared to 30 years ago only 3 times more oil is being drilled yet the price is 10 times more. (talk) 16:29, 3 January 2008 (UTC)

Well...Supply and demand? Honestly, who says that we use JUST 3 times more oil then used to be drilled. As I'm no expert on the matter (I do work at a petrol station...that hardly counts) I feel it's just the natural progression of money. Everyone wants more, so people ask to get paid more, so prices for everything, oil included, goes up. —Preceding unsigned comment added by (talk) 21:15, 3 January 2008 (UTC)
Price basically is determined by supply and demand. Important to understand though are the effects of inflation, elasticity (economics), and taxes arising from externalities. Richard001 (talk) 07:38, 4 January 2008 (UTC)
Why such a high price? Because exporters discovered that if they doubled the price, from $15 to $30, there was no recession. Double it again, no recession. Double it again, and . . . well, let's see. Seriously: OPEC didn't think it could get away with such a high price; now that they know they can, we won't see $40/bbl for a very long time. DOR (HK) (talk) 04:21, 29 May 2008 (UTC)

Or maybe because, when supply is constrained, relative to possible demand, the price will rise until the poorest bidders are forced to drop out. This is the complete opposite of 1999, when producers could hardly give the stuff away. Now the big question for each of us, should be "when do Idrop out of the game", well, here in the UK, I guess we could take another factor of 10 in price rise, as the very limit of possible/impossible to drive as we do today, and it would be extremely unpleasant for a great many folk before that.

Having a large reserve on its own is no good, the tank needs a fat enough tap on it to match the flow rate. And there can be no doubt that the flow rates from many of the former independant sources, like the North Sea, are very much in irreversible decline as the well pressures drop. —Preceding unsigned comment added by (talk) 16:44, 10 June 2008 (UTC)

The primary reason for the rising price of oil is due, primarily, to inflation (devaluation of currencies)...of course, this will likely not get very far on wikipedia, as many are very trusting of "official" or governmental statistics on inflation.--Fox P McCloud (talk) 03:27, 11 June 2008 (UTC)

If by devaluation, you mean against the cost of oil or some energy intense product, like aluminium or copper, you are right, but to consider say, the relative devaluation of the dollar and the GBP against say the Euro or the Yen is not enough, as oil is definitely increasing in cost in these countries too, and at higher rate than the rising prices of food and local services. Of course, another way to look at this is to say that the high energy prices cause inflation, and the money in your pocket now buys less, but how much less, depends in part on how energy efficient you were - so we might expect the USD to fall further than the GBP, which in turn falls further thna the Euro. To some extent this has happened, but it's not the full story. —Preceding unsigned comment added by (talk) 08:58, 11 June 2008 (UTC)
The declining value of the US$ results from the astronomical US trade deficit. The US, apparently unbeknownst to many people who live there, imports 2/3 of its oil. The US uses a huge amount of oil in the form of gasoline and diesel fuel, and most of it comes from elsewhere. If you use it, you have to pay for it, and if you can't export anything that anybody else in the world wants to buy, people start discounting your currency and demanding more of it to pay for their products. And by people, I mean OPEC. RockyMtnGuy (talk) 15:32, 22 July 2008 (UTC)

History section[edit]

The history section seems to be trying to use summary style without actually summarizing the articles. The reader shouldn't be forced to read another article to get an overview of less recent events in the history of oil prices. If the main template is used, a summary of the article linked to should generally follow. Is this just lack of development? Richard001 (talk) 07:35, 4 January 2008 (UTC)

From the point of view of a nonobsessive wikipedia user, all of the citation needed's in this article make wikipedia look 10 miles left of retarded —Preceding unsigned comment added by (talk) 22:53, 4 January 2008 (UTC)

Actually, I would like to see any mention at all of the history up until the 1960s too... (talk) 17:47, 6 January 2008 (UTC)


There has to be some mistake in this text, if you compare it with "oil reserves". Contradiction!!: oil reserve says: "Iran had the world's second largest reserves of conventional crude oil at 136 gigabarrels as of 2007, although it ranks third if Canadian reserves of non-conventional oil are included. This is roughly 10 percent of the world's total proven petroleum reserves. Iran is the fourth largest oil producer in the world and is OPEC's second-largest producer after Saudi Arabia. As of 2006 it was producing an estimated 3.8 million barrels per day (bbl/d), equal to 5 percent of global production.[22] At 2006 rates of production, Iran's oil reserves would last 98 years if no new oil was found."

this text says: Particularly significant are Indonesia, which no longer exports oil, Mexico and Iran, where projected demand will exceed production in about 5 years, and Russia, which is growing rapidly.

Iran cannot exceed production in about 5 years if it has still oil reserves lasting for about 98 years. (talk) 21:07, 13 March 2008 (UTC)LA

Sure it can. Reserves say how much is in the ground; doesn't say anything about how much it is possible to pump out on a daily basis. Besides, their internal demand is growing, so if their production stays equal, projected demand will still exceed production at some point. (talk) 09:42, 23 June 2008 (UTC)

Numeric Error[edit]

Under Recent Price History - Paragraph Six - Last Sentence reads - "Prices continued to rise to a peak of $538555.544% on November 7, 2007 before starting to fall."

Obviously the number $538555.544% can't be correct. —Preceding unsigned comment added by (talk) 04:00, 5 April 2008 (UTC)

We need new pictures.[edit]

Gas hits $3.50 around the country already. It's time to update the pictures, especially the one with Shell Gas Station, showing only $2.91/Gal. I say that with respect to all the wiki editors who go out & hunt for pics, it's just a friendly reminder, that's all. TheAsianGURU (talk) 23:13, 21 April 2008 (UTC)

"The Asian Guru," which country might that be? Where I live (Hong Kong), US$8/gal is typical; the UK is looking at $10. DOR (HK) (talk) 04:24, 29 May 2008 (UTC)

Major overlap with Oil price increases since 2003[edit]

There's a huge overlap between this article and Oil price increases since 2003. They share most of the same images, and the other article has newer gas station sign pictures. We need some consolidation and merging. Also see Peak Oil. --John Nagle (talk) 16:44, 1 May 2008 (UTC)

Agreed. Most of the details in the Recent price history section should be summarised or merged into Oil price increases since 2003. This article shouldn't be about day-to-day changes in the price even if a new record price is being set. That information would be best provided on the main articles listed, with a short intro para on this one. - Shiftchange (talk) 06:17, 2 May 2008 (UTC)
I tried shortening the recent price history to only mark dates when oil crossed specific landmark price thresholds, $80, $90, $100. There is plenty of detail, as you say in Oil price increases since 2003. This one probably still could shrink a little, but I made a start (I took out one picture--but the US centric stuff might not belong either). maxsch (talk) 17:23, 10 May 2008 (UTC)

$ 126[edit]

I added this record so far: It further rose above $126 a barrel for the first time Friday, amid gas prices’ hike above an average $3.67 per gallon at the , Gas jumps above $3.67, oil passes $126 on Venezuela concerns --Florentino floro (talk) 06:50, 10 May 2008 (UTC)

Again, please specify where you are. $3.67/gal would be less than half the price we pay in Hong Kong! DOR (HK) (talk) 04:25, 29 May 2008 (UTC)
Such prices are in the United States, which taxes gasoline 30 cents a gallon. The current average price for gasoline, petrol, at the pump is $3.94, for diesel $4. 59. These prices remain somewhat low at a barrel price of $130, i.e. a refiner buying input stock at that price would be running at a loss. Fred Talk 17:14, 29 May 2008 (UTC)


I would like to say that the oil prices drops when we invent the new hybrid vehicles which uses solar and petrolem energis. —Preceding unsigned comment added by (talk) 09:12, 3 June 2008 (UTC)

$ 142.99[edit]

Record since - Oil prices on June 28, hit record of $142.99 at 1:58 p.m., the highest since 1983 and to $142.97, the highest intraday price since 1988, owing to a weak dollar, geopolitical unrest and global equities, Oil Rises Above $142 for First Time as Investors Spurn, Oil rises to trading, closing records on falling US, Oil hits record near $143 on rising investor flows--Florentino floro (talk) 07:15, 28 June 2008 (UTC)


Would it be worthwhile to mention the paradigms that may be influencing the oil price? I have references for these.

It is thought by some that we are in Peak oil since 2006. Peak oil is the point in time when the maximum rate of global petroleum extraction is reached, after which the rate of production enters terminal decline. Peak oil is not about running out of oil, it's about the rate at which oil can be supplied to the market. If the rate at which it is demanded exceeds the rate at which it can be supplied, oil prices will go up.

In an attempt to stimulate the ailing U.S. economy, the the Federal Reserve has cut rates by three percentage points since September 2007. But the rate cuts are also inflationary, weakening the dollar and sending oil prices higher.

Since the oil price is indexed to the dollar, as the dollar drops in value, the price of oil increases. If one looks at inflation adjusted oil prices, they remain relatively flat.

As the dollar continues to depreciate in value, investors have bought oil futures as a hedge against inflation. It is thought that as much as 60% of today's crude oil price is pure speculation driven by large trader banks and hedge funds.

Oil prices are high because the United States is actively engaged in wars in Iraq and Afghanistan and perusing war with Iran in the middle east.

"Resource nationalism" and political tensions in Nigeria, Venezuela, Iran and even Mexico are further constraining supply. These oil producing countries would like to use the oil in their countries to develop the country rather than to make the oil available to world markets.

Kgrr (talk) 19:25, 27 July 2008 (UTC)

Yesterday, I added some text describing the interim report of the Interagency Task Force on Commodity Futures. It was appointed by the U.S. congress to evaluate whether futures market speculation had driven up the price of oil. You should read it, there's some really first-rate analysis in it. Of course, these guys are the pros in the business of market analysis. The bottom line: No, it's not speculation, it's for real.
  • Supply and demand: This is Economics 101. You said, If the rate at which it is demanded exceeds the rate at which it can be supplied, oil prices will go up. Yes, that's it.
  • Inflation/Declining dollar: You said, If one looks at inflation adjusted oil prices, they remain relatively flat. No, sorry, they don't. The ITF report has a nice graph of this.
  • Futures market/Speculation: You said, It is thought that as much as 60% of today's crude oil price is pure speculation driven by large trader banks and hedge funds. The ITF analyzed the data and came to the conclusion that the traders were just following the market up. Oil prices were going up regardless and the increase was driven by fundamentals. Supply no longer satisfied demand.
  • War/Iraq/Afghanistan/Iran: It doesn't help prices to start a war, but these fall into the geopolitical considerations category. There's always a war going on somewhere. The ITF believes the real problem is economic fundamentals.
  • Resource Nationalism: You said, Political tensions in Nigeria, Venezuela, Iran and even Mexico are further constraining supply, which is true, but that would not be a problem if there were surplus production capacity elsewhere on the planet. The problem is that most non-OPEC producers are going into steep decline and the only OPEC country with surplus production capacity is Saudi Arabia. Their failure to bring surplus capacity on-line is bringing up the question, Do they really have surplus production capacity, or are they just blowing smoke?
RockyMtnGuy (talk) 00:19, 28 July 2008 (UTC)

"Future" tidying-up[edit]

I removed the following from the "Future" section since it does not belong there:

A difficult factor to isolate is the total volume of the futures markets themselves. As there are many indirect owners of futures (401k plans, mutual funds, and even simple savings accounts are routinely invested in such things without the account holder being explicitly aware,) the knock-on effect of a downwardly spiraling economy could itself further devalue oil. Similar factors corrected the run away that gold and silver experienced in the early 1980s, for example.

As with any speculation market, it is well within investors' ability to drive up the price of futures well out of proportion with the supplies and demands involved. But there are two dangers that can quickly affect such transient spikes. Demand can drop off, and supply can increase. This was the case in 1998/1999 when the Asian market collapsed, reducing demand, and Iraq increased production by over 12%, increasing supply. This caused the all-time low of $8.

In the post-Sept 11th world, after an initial dip below $25 a barrel, oil prices started to rise. As it pertains to recent events, the demand side is slowing, though not appreciably enough. The US Congress opened to panels to investigate the potential speculation fraud on Tuesday June 17. On the same day, Saudi Arabian oil production increase by 200,000 barrels a day, the largest in its history was announced as a potential option. This and other factors caused oil to drop for fourth day in a row, closing at $133.53.[1] A weak dollar and Iran war talk caused the biggest single day increase ever. A rise of $11 in a single day took the price to $138.[2] Once again war games by and with Iran raised the price of oil to above $146.[3] Ironically enough, on July 16 2008, mounting concerns of spiralling oil prices and the effect on the economy helped plunge the oil by its biggest ever single day fall since 1991[4] of $6.44 (at one point more than $10 on the same day). According to the AP, "an extremely volatile session" coupled with "fears that record fuel prices are spreading broad economic pain exacerbated the third big sell-off in just over a week."[5]

I suggest to leave it out of the article entirely (they do not add much, if any, information), but if someone disagrees (s)he may add it to a more appropriate section.--Roentgenium111 (talk) 19:51, 31 July 2008 (UTC)

Market forces[edit]

I think the article should now focus on factors affecting the psychology of the market rather than present a report on prices. At the moment the article doesn't cover the short-term market forces like bad weather, industrial accidents, militant attacks on infrastructure and similiar events. Long term factors like consumer trends, taxation, technological developments and production matters should also be explained. - Shiftchange (talk) 05:44, 21 August 2008 (UTC)

Important notice on current trend[edit]

Now it seems that the price of oil is going downwards, it was ~80$ / barrel today. If you look here and the 1 year forecast, it has gone down for the last 3 months.

The current graphs are now misleading, not showing the latest trend on oil prices. (talk) 15:41, 10 October 2008 (UTC)

The graphs are still misleading because they don't document the latest trend in oil-prices. The price of oil has gone down for the last 3 months. Currently it stands at ~67$ / barrel. Please check the link above. (talk) 09:06, 24 October 2008 (UTC)
I have replaced two of the charts so that they now show prices up to 2008 October 17. The other charts are beyond my ability or desire to update. The source used is . -84user (talk) 17:14, 24 October 2008 (UTC)

Broken links[edit]

I noticed that reference 32, referencing an article on cnn money on may 30 2008 is broken, but when I wanted to edit it there was only this in the page: "{ { reflist | 2 } }". I think the correct link to the article should be: which is the only article published on that date on that subject. Someone can correct this or i could do it if someone could tell me how to fix the reference list. MrZap (talk) 13:00, 4 November 2008 (UTC)

Using Mother Jones as Reference[edit]

I oppose the use of overtly political material as a source. The relevant text:

"Economist James K. Galbraith believes that much of the rise is due to the "Enron loophole" drafted in a rider by former Texas senator Phil Gramm, which allowed energy futures to avoid Commodity Futures Trading Commission oversight. (cited to Galbraith's piece in Mother Jones)

I see no problem citing Galbraith's article as a source on his opinion, assuming he is an "expert" as claimed and not a journalist or commentator. The problem is the part I have emboldened, which attempts to introduce two points of fact, (1) that Gramm drafted the rider, and (2) that the rider exempts futures from oversight.

Factual statements about a politician should be expected to use a source more credible than a political magazine with a stated ideological/political agenda that is directly in conflict to the political position of that politician. A government report, non-ideological website, or mainstream news source would be acceptable. Geogene (talk) 20:52, 30 June 2009 (UTC)

(sarcasm)Yeah! Who the F is this James K. Galbraith "commentator", and why should we ever listen to anyone in that family about economics??? (/sarcasm) You should probably do more research before you make such statements. NJGW (talk) 22:12, 30 June 2009 (UTC)
You have reworded my (Galbraith) "suggested" to (Galbraith) "observed", which is NPOV. It implies that what Galbraith is predicting to happen in fact did occur. Further, you have used "Mother Jones" as a source of "factual material" regarding a Republican senator. This would be little different from citing the "Weekly Standard" for information on a Democratic senator. This is acceptable in some circles today but inappropriate for an encyclopedia.
The ad hominem attack was not appreciated.
I suggest that you use mainstream news sources from here on out. Other material will be contested. Geogene (talk) 23:50, 30 June 2009 (UTC)
I undid your whole edit because of it's problems and your lack of understanding of who Galbraith is. "Observed" in that context is ambiguous. "Suggested" is just as meaningless. As for mainstream, even blogs are acceptable if their writers are notable and respected enough. NJGW (talk) 00:35, 1 July 2009 (UTC)
You reverted my edit because of a comment on the Talk page? As for wording "observed that...." implies something will or did in fact happen. Therefore it is NPOV. Geogene (talk) 00:42, 1 July 2009 (UTC)
Yes, I did. You said, "I see no problem citing Galbraith's article as a source on his opinion, assuming he is an "expert" as claimed and not a journalist or commentator." G. is an expert. NJGW (talk) 21:19, 1 July 2009 (UTC)
I agreed with your statement. However it does not give you warrant to make the statement of fact that follows, that Gramm was responsible for a enron loophole that cause deregulation. I thought that was stated clearly. I recommend you stop obstructing my edits. I further recommend that you cite the claim about Gramm with a mainstream source. Geogene (talk) 21:55, 1 July 2009 (UTC)

The problem I have with the statement is that "Gramm drafted" is placed as if it is a statement of fact. I would agree with the wording if reliable sources were placed to establish that (1)Gramm wrote the loophole and (2) it caused deregulation. I would also agree with an edit that re-worded the statement to show that "(Galbraith believed) that Gramm wrote the loophole" and "(Galbraith believed) the loophole caused deregulation".

I added a factcheck request last night, you didn't like it. (Throwing the baby out with the bathwater.) I think that qualifies as obstruction. If you think that my edits cause too much collateral damage, you can implement the necessary correction yourself and settle the issue. Otherwise I think you should present a cogent explanation for why you think factual statements should come from partisan magazines. Geogene (talk) 22:04, 1 July 2009 (UTC)

Again, they come from Galbraith, not the magazine. You keep pretending to agree to one point but not the implications of that point. As for citations, take your pick: [1][2] Keep making collateral damage and I'll keep undoing your whole edits... we're not here to clean up your mess. NJGW (talk) 22:14, 1 July 2009 (UTC)
  • I wrote the section in question[3] - note that it's pretty reasonable to say that some holders of oil will stop selling when the price drops to low if they think there will be another rally. There's a group which does just that. II | (t - c) 22:52, 1 July 2009 (UTC)
And it is just as reasonable to say that some other holders of oil will produce and sell all that they can. The section in question claims that when prices go up, producers restrict supply to run prices higher. That is speculation, attempts to predict the future, and runs against the usual laws of supply and demand. It's bad economics. But since it's qualified with a "may", and because it's clearly shown that Galbraith is the one that espouses the view (not presented as a statement of fact), I do not object to that specific point and am not interested in changing it. Geogene (talk) 00:11, 2 July 2009 (UTC)
Hmmm, I don't think that's reasonable. In economics there's something called supply and demand. When price goes up, supply goes up. When price does down, supply goes down (and demand goes up). It's one of the most axiomatic principles in economics. II | (t - c) 00:13, 2 July 2009 (UTC)
Well, there's the problem. You said that you wrote the section in question. I thought you meant the part where Galbraith contradicts the law of supply and demand. To quote directly from the article:
"Galbraith observed that with Goldman Sachs predicting a rise in the price to $200 and Gazprom $250, suppliers may react to the rise by restricting supply until they can sell their product at a higher price."
That's what I said would run counter to what is generally believed by economists. But it represents Galbraith's view so it is a non-issue. It should stay, unless he was misquoted. Sorry about misinterpreting you. Geogene (talk) 00:54, 2 July 2009 (UTC)
Sorry, I misread you, and I did write that part. You're right, Galbraith is speculating a bit there. The quote from the article:

So the futures price goes up. As it does, supplies actually disappear. For instance, copper expert Frank Veneroso believes that 800,000 tons of copper has been hidden away in China, waiting to emerge closer to the market top.

Financial markets can work paradoxically like this -- as price goes up, demand goes up and supply becomes tight. This happens particularly when you have analysts forecasting huge increases in the future, as happened in the dot-com bubble and as happened here. That's why economic bubbles happen. It's not bad economics per se, just a bit more subtle. II | (t - c) 01:03, 2 July 2009 (UTC)

Ed Wallace[edit]

I have changed the wording in the speculation section. "Expert" is no longer there. Ed Wallace is not an "expert" on the economy or on oil. He is a journalist who writes reviews on new cars.

Wrong again. From his bio: "Ed Wallace is a recipient of the Gerald R. Loeb Award for business journalism, given by the G. and R. Loeb Foundation, and is a member of the American Historical Society." NJGW (talk) 00:35, 1 July 2009 (UTC)

Further, I have changed "article by Ed Wallace" to "opinion piece by Ed Wallace". The "Viewpoint" segment of BusinessWeek is an opinion section. All references to commentary should be labeled as such. Geogene (talk) 23:55, 30 June 2009 (UTC)

Isn't that section talking about "expert opinions"? Kind of over the top to say that "in the opinions of experts, the opinion they write in opinion pieces is that..." NJGW (talk) 00:35, 1 July 2009 (UTC)
Yes, the section is talking about "expert opinions". Which is the problem because Ed Wallace is not an "expert". He is a commentator (journalist) offering his opinion in an opinion piece (which you changed to read "article"). Please do not post factually incorrect material in articles. Geogene (talk) 00:38, 1 July 2009 (UTC)
What kind of expert are you looking for? How about one that receives "business journalism's highest honor"? How about one whose opinions are deemed important by BusinessWeek? Do you have anything to say about Wallace besides that he is not someone you know? NJGW (talk) 21:27, 1 July 2009 (UTC)
We can keep that wording since "commentator" and "pundit" bother you so much...even though that's what journalists are. Having received "journalism's highest award" does imply that he is a journalist, right? Not a geologist. Not an economist. But a paid commentator. Quoted in an opinion piece. What an "expert". Fine business. Geogene (talk) 21:47, 1 July 2009 (UTC)

Copyvio removal[edit]

I removed 3 paragraphs, called "Petroleum Politics", as a copyvio of (talk) 16:22, 28 October 2009 (UTC)

Price graph needs an update[edit]

The price of oil graph is now a year behind, and in the last year, the price has doubled. See [:File:Brent Spot monthly.svg] for links to the raw data. It's not hard to make a graph, but mine, made with OpenOffice Calc, didn't match the look of this one. --John Nagle (talk) 03:48, 24 October 2010 (UTC)

We should also add the oil price in gold ounces! -- someone

"Reasons for trends" section is uncited[edit]

The "Reasons for trends" section is uncited, and pure speculation. Oil pricing is weird. Most of the players on the supply side are governments, and they have a cartel, OPEC. Demand is "notoriously inelastic" [4] - the price of oil has tripled with demand decreasing by only a few percent. A simplistic "Economics 101" explanation is inappropriate. --John Nagle (talk) 18:06, 27 October 2010 (UTC)

I've nominated the article on WP:ITN/C to be displayed on the Main Page, and this means that there should be no uncited info and original research. So, at least for a time I move the problematic section here. If citations are provided, feel free to return it back. GreyHood Talk 02:18, 1 February 2011 (UTC)

The price of oil, like the price of all commodities, is subject to major swings over time, particularly tied to the overall business cycle. When demand for a commodity like oil exceeds production capacity, the price will rise quite sharply because both demand and supply are fairly inelastic in the short run. Users of oil might be shocked by much higher prices, but they have commitments and habits that determine their energy use, and these take time to adjust. On the supply side, especially at the outer edge of existing production capacity, adding new capacity is time-consuming and expensive.

Moreover, the supply side is severely influenced by oligopolistic group of swing producers. Over time, however, both businesses and individuals figure out ways to cut back their oil consumption in response to high prices, and the high prices promote new investment in production and the arrival of new sources in the market, gradually restoring a supply-demand balance. Most commodity prices (such as metals and grain) are subject to similar large swings over time.[citation needed]

  • Also, I move two more problematic sentences from the lead section here:
The vast majority of oil is not traded on an exchange but on an over-the-counter basis.[citation needed]
Others [who?] argue that the run-up in oil prices over the past few years actually led to an acceleration in global growth. The huge surpluses built up by oil exporting countries were recycled through sovereign wealth funds and the banking system and (through the money multiplier) greatly increased investments in emerging markets and helped hold down interest rates in the U.S.

Watch out for the discussion at WP:ITN/C. GreyHood Talk 02:17, 1 February 2011 (UTC)

Short term changes vs. longer trends[edit]

The intro currently says "On 31 January 2011, the Brent price hit $100 a barrel for the first time since October 2008, on concerns about the political unrest in Egypt". I don't doub't that the jump in price that happened then had to do with that, but this wording makes it seem like the overall explanation for the upwards trends in oil prices we see is due to a series of unconnected single events, rather than an overall supply/demand issue. Instead of mentioning details like the effect of unrest on oil prices, the intro should mention some of the long-term price drivers mentioned further down in the article. Amaurea (talk) 10:02, 6 April 2012 (UTC)

  1. ^
  2. ^
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  4. ^ CNN International. July 16, 2008, 3-3:30am CET
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