More than four decades ago, an oil crisis hit the United States which forever changed the way Americans view their need for oil. The 1973 oil crisis was prompted by Saudi Arabia’s pullout of exported oil to the US after the country expressed its support to the Israelites in a war against the Middle East.
The oil crisis resulted in record-high oil and gas prices which enraged motorists and American energy consumers. At the same time, the oil crisis also taught Americans to become more frugal with what little oil they have by modifying their preferences and lifestyle. It also prompted the rise of energy-efficient appliances and practices which brought helped consume less energy.
Oil Wells in Tulsa, OK
Each president after the 1973 oil embargo aspired for an energy-independent America. While it was many years after the oil embargo that more effective drilling technologies were discovered, it inspired the American government to work on generating their own oil and gas so they wouldn’t have to fully rely on imported oil from other countries. Shales like the ones near Tulsa are now being plumbed for their deep oil and gas reserves to aid in the energy independence initiative.
Decades after the oil embargo, the United States is now at the brink of being an energy superpower. New technologies like fracking led American oil operators to reach previously inaccessible oil reserves. Today, the United States has been making more oil than history has ever seen. The oil embargo may have subjected the country to a crisis, but it was also the driving force why America has incessantly sought ways to become energy-independent by tapping its own resources.
Oil & Gas Investing in Tulsa
Putting a price on oil per barrel is not as simple as putting a tag on it. Oil price is determined by the interplay of complex factors, including supply, demand, quality of oil and the futures market. Whether you’re a new or a seasoned oil investor, knowing how these key elements affect oil price will help you become wiser and educated in making investment-related decisions.
As a global commodity, there will always be demand for oil. This is most true as countries move towards industrialization. In most cases, where there is high demand for oil, the price also increases. However, we should also consider that oil price can fluctuate and go down even if there is huge supply to meet the huge demand.
Oil in America
Supply for oil varies from one nation to the next. Whereas supply for US oil was quite scarce four decades ago, depending heavily on oil imports from other countries, that is not quite the case nowadays. The US is now digging its own oil from its own land, satisfying its own demand and now even entertaining the idea of exporting some of its own supply. Because of this bright future, oil & gas investing opportunities in Tulsa are ripe for the picking.
Other countries may have great supply of oil but they may not have the resources and technology. In some nations, geopolitical conflicts may hinder or curtail the production of oil, therefore shortening its supply and affecting oil price.
Other important elements that oil price are the quality of oil and the futures market. Sweet crude oil goes through a more refined and expensive process. It is expected then that sweet crude is more expensive than other types of oil. The futures market, on the other hand, is a contract indicating an oil buyer to purchase oil from a certain oil supplier at a pre-defined price and pre-defined time frame, despite the global oil price.