Changes

Oil, like any other valuable commodity is subject to the laws of demand and supply. Oil is subject to the law of demand which states that the higher the price, the lower the demand, and vice versa, other things remaining constant. It is important to note that the demand and supply of oil makes it a special resource. Demand refers to how much of a product or service is desired by buyers at various prices. Oil is an example of a good that experiences derived demand. This is one where demand for a factor of production or intermediate good occurs as a result of the demand for another intermediate or final good. Supply is the amount of a product that producers and firms are willing to sell at a given price when all the other factors are held constant.

Oil, like any other valuable commodity is subject to the laws of demand and supply. Oil is subject to the law of demand which states that the higher the price, the lower the demand, and vice versa, other things remaining constant. It is important to note that the demand and supply of oil makes it a special resource. Demand refers to how much of a product or service is desired by buyers at various prices. Oil is an example of a good that experiences derived demand. This is one where demand for a factor of production or intermediate good occurs as a result of the demand for another intermediate or final good. Supply is the amount of a product that producers and firms are willing to sell at a given price when all the other factors are held constant.