Whether you have just started investing in oil or has been doing this for a long time, oil price is one of the most factors to look out for day-after-day. However, determining the price of oil is not a very simple process. It comes from the determining how different factors – supply, demand, quality and market—interplay with one another.
It is a fact that oil is worldwide commodity. There will always be a demand for oil, most especially among countries fast moving towards industrialization. However, this demand must adequately be met by the supply of oil. In most cases, small supply of oil to meet a huge demand could mean that oil is going to get expensive. However, if there’s an overflow of oil to meet the huge demand, we could expect for oil prices to fluctuate.
Supply and Demand of Oil
Aside from the interplay of supply and demand, a country’s geopolitical status could also affect oil price. Geopolitical conflicts may prompt an oil-producing country to shorten its oil production to a specific nation, while an oil-exporting country may opt to get its supply elsewhere if it is in conflict with its main supplier. Wars, new policies and other worldwide events could trigger oil prices to go up or down from time to time.
Other oil price indicators involve the futures market, or the agreement of an oil buyer with to get its oil supply from a certain seller for a pre-determined price and time frame. On the other hand, oil quality involves the process and technology to create an oil product, therefore making certain types of oil more expensive than others. With the boom in the oil, gas, and refining industries in the US, oil prices are being driven down by investors and drilling companies taking advantage of the reserves near Norman and all across the South.
Norman Oil & Gas Investing
After the discovery of the first oil reserves in Texas that stretch towards Norman, OK, the United States realized that its undergrounds hold so much oil potential. However, the 1970s oil crisis and inflation prevented Americans to fully utilize these potentials to their advantage.
Oil in the USA
The recent US oil boom has turned the tables and allows Americans to source their own oil and gas from their own undergrounds. Now that the US is more reliant to its domestically-sourced oil and less on imported oil, a number of impacts are felt in various sectors.
The US oil boom gives the country a more solid ground to grasp energy independence. With cheaper domestic oil, consumers are able to pocket significant savings from their energy expenses. Along with the promotion of energy-efficiency in home appliances and vehicles, this dream is becoming close to reality.
Oil & Gas Investment Opportunities
Second, the US oil boom promised more employment in oil-dependent sectors and businesses. Cheaper oil provides businessmen and investors savings from their operating costs, enabling them to hire more manpower for their businesses. Some of the sectors that experienced evident increase in employment rate with regard to the US oil boom are the automotive, shipping, manufacturing and food and beverage industries.
The US oil boom has also changed the policies with regard to oil imports and exports. The US soil was found to be rich in soil, making the US oil boom not just a trend but possibly a long term oil phenomenon that can change the country’s oil market, as well as globally. With this boom, Norman oil & gas investing opportunities are being snatched up as quickly as they come available.
If you’re looking into investing in oil wells or natural gas, our free insider’s guide will give you the information you need to make a sound investment decision.