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In the period between 2007 and 2008, the price of oil increased from 60 dollars to 100 dollars. The price went up to an all times highest of 115 dollars in July 2008. The cycle was the same around April and august 2009.
Oil prices behave much as any other commodity with wide price swings ill times of shortage or oversupply. The domestic industrys price has been regulated though the production or price controls throughout the twentieth century.nbsp.
Crude oil prices ranged between $2.50 and $3.00 from 1948 through the end of the 1960s. Throughout the post war period, exporting countries found an increasing demand for their crude oil and a 40ul (, decline in the purchasing power of a barrel of crude. In March 1971, the balance of power shifted. This happened as a result of the Texas Railroad Commission setting a proration at 100%, for the first time. This meant that Texas producers were no longer limited in the amount of oil that they could produce. More importantly, it meant that the power to control crude oil prices shifted from the US (Texas, Oklahoma, Louisiana) to OPEC.nbsp.
In 1972, the price of crude oil was about $3.00 and by the end of 1974, the price of oil had quadrupled to $12.00. The Yom Kippur War started with an attack on Israel by Syria and Egypt on October 5, 1973. The US and many western countries supported Israel. As a result of this support, Arab oil exporting nations imposed an embargo on the nations supporting Israel. Arab nations curtailed production by 5 million barrels per day (MBPD). About I MBPD was made up by increased production by other countries. The net loss of 4 MBPD extended through March 1974 and represented 7 percent of the free world production. Prices increased 400% in six short months!nbsp.
Events in Iran and Iraq led to another round of crude oil price increases from 1979-80. The Iranian revolution resulted in the loss of 2.5 MBPD between 1978 and 1979. In 1980, Iraqs oil production fell 2.7 MBPD and Irans production