Classical economists defined supply as the amount of a commodity that is readily available for use and demand as the need or desire for use of that particular commodity. It’s important to realize that prices of the oil resource are not set or determined by a particular company, it is subject to market forces of demand and supply. Using this as a baseline, it’s therefore imperative to conclude that this great dependence that price has on market forces is the birth of the global demand and supply issues. Over the past decade, the oil price trends have shown a general decline and this can be attributed to a supply strain as shown in the figure below. | Classical economists defined supply as the amount of a commodity that is readily available for use and demand as the need or desire for use of that particular commodity. It’s important to realize that prices of the oil resource are not set or determined by a particular company, it is subject to market forces of demand and supply. Using this as a baseline, it’s therefore imperative to conclude that this great dependence that price has on market forces is the birth of the global demand and supply issues. Over the past decade, the oil price trends have shown a general decline and this can be attributed to a supply strain as shown in the figure below. |