Oil prices fall: Who wins, who loses?
Oil prices fall: Who wins, who loses?
Reducing oil prices usually brings a sense of happiness to the nations where it is most used.
On average, every US citizen uses 10 liters of oil or oil-related products per day.
But on the other hand, the decline in the price of crude for oil producing countries signifies disaster for millions.
This is why oil is called 'black gold'. When the price of oil was high, the revenues from it were filling up the recommendations of oil producing companies and countries, with the same income the people of these countries were passing through and public facilities were available.
But for such countries, oil is becoming more and more of a blessing.
The International Energy Agency has already warned that this situation will affect most Nigerians, Iraq and Ecuador and their countries will reduce their income by 50% to 87%. It was estimated at $ 30 a barrel, but now a barrel of oil is less than $ 20.
For the first time in the history of the world, oil prices have fallen to a negative level
98.5% of Iraq's revenue depends on oil imports. The remaining 1.5% of revenue comes from precious nuggets, metals and fruits.
International Energy Agency claims that Iraqi government will face $ 50 billion reduction in spending this year, with government employees' salaries removed, while spending on already under-stressed health systems the lowest Will be on
The amount of money a country spends on oil production also shows its weakness. Saudi Arabia spends the least on oil extraction, but even so, Saudi Arabia's dependence on oil can lead to a $ 100 billion reduction in its revenues.
The effects of the abnormal drop in oil prices in 2014 are still evident in the Saudi economy and it is now trying to get out of it. And this revenue gap could not be filled by promoting tourism or any other revenue sector.
To balance the Saudi government's spending, oil prices need to be up to $ 85 a barrel.
Unfortunately, it was Saudi Arabia that intensified the process of imbalance in oil prices when it threatened to increase oil production to its rival Russia. However, Russia is a country that is not affected by fluctuations in crude oil prices.
On this occasion, President Trump has come out and announced additional support for the US oil and gas industry. This additional support is in addition to the $ 650 billion in funding that the oil sector is already receiving.
The US economy relies less on oil production than other oil producing countries, and that is why the United States will be less affected. The fluctuation in shares of West Texas Intermediate was in fact due to higher oil prices and distribution problems.
Generally in countries where consumers are high they will address this shortfall, but currently this is not the case in many countries, and this is because of restrictions on oil production and transportation.
But it will most benefit China, which is the largest consumer of oil. China is the fifth largest importer of oil and at a time when it is trying to revive its industries and is reportedly storing crude oil.
Overall, now that oil prices have fallen, the chances of severe recession in oil producing countries have increased. However, if the recession lasts longer then many other countries will benefit from it.
Reducing oil prices usually brings a sense of happiness to the nations where it is most used.
On average, every US citizen uses 10 liters of oil or oil-related products per day.
But on the other hand, the decline in the price of crude for oil producing countries signifies disaster for millions.
This is why oil is called 'black gold'. When the price of oil was high, the revenues from it were filling up the recommendations of oil producing companies and countries, with the same income the people of these countries were passing through and public facilities were available.
But for such countries, oil is becoming more and more of a blessing.
The International Energy Agency has already warned that this situation will affect most Nigerians, Iraq and Ecuador and their countries will reduce their income by 50% to 87%. It was estimated at $ 30 a barrel, but now a barrel of oil is less than $ 20.
For the first time in the history of the world, oil prices have fallen to a negative level
98.5% of Iraq's revenue depends on oil imports. The remaining 1.5% of revenue comes from precious nuggets, metals and fruits.
International Energy Agency claims that Iraqi government will face $ 50 billion reduction in spending this year, with government employees' salaries removed, while spending on already under-stressed health systems the lowest Will be on
The amount of money a country spends on oil production also shows its weakness. Saudi Arabia spends the least on oil extraction, but even so, Saudi Arabia's dependence on oil can lead to a $ 100 billion reduction in its revenues.
The effects of the abnormal drop in oil prices in 2014 are still evident in the Saudi economy and it is now trying to get out of it. And this revenue gap could not be filled by promoting tourism or any other revenue sector.
To balance the Saudi government's spending, oil prices need to be up to $ 85 a barrel.
Unfortunately, it was Saudi Arabia that intensified the process of imbalance in oil prices when it threatened to increase oil production to its rival Russia. However, Russia is a country that is not affected by fluctuations in crude oil prices.
On this occasion, President Trump has come out and announced additional support for the US oil and gas industry. This additional support is in addition to the $ 650 billion in funding that the oil sector is already receiving.
The US economy relies less on oil production than other oil producing countries, and that is why the United States will be less affected. The fluctuation in shares of West Texas Intermediate was in fact due to higher oil prices and distribution problems.
Generally in countries where consumers are high they will address this shortfall, but currently this is not the case in many countries, and this is because of restrictions on oil production and transportation.
But it will most benefit China, which is the largest consumer of oil. China is the fifth largest importer of oil and at a time when it is trying to revive its industries and is reportedly storing crude oil.
Overall, now that oil prices have fallen, the chances of severe recession in oil producing countries have increased. However, if the recession lasts longer then many other countries will benefit from it.
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