Economics

1

Intruduction to economics, Essay 1

About the worldwide oil market
We live in a world moved by the car industry. All in this century is thought for the cars. Huge roads wide in all over theworld. A complex and chaotic system of signals, drive rules and a unsustainable energy fount for these way of transport; the oil. Responsible of wars and economic crisis, it is the black gold of ourtimes. Its production is directly connected to the places where it can be found. This fact is really important, because it gives money and power to the owners of the land where it is. Let’s take asimple example. A piece of land in the middle of the dessert, or somewhere in the artic sea, is an extreme place unavailable to live or to get any economic resource. But, if under the surface you findpetroleum then all change. Considering that everyday people will need to move, to take the car or a bus or a taxi we need to know that someday and somehow the petroleum will be finished. We see thatour way of live is directly linked with the oil. The problem is that just a few countries have a considerable quantity of petroleum. So, they play with a global need to obtain the maximum profits.Leaving the production invariable, global producers can speculate with the price easily. The demand of oil is always increasing. Every day, thousands of new cars are sold, and not the same quantitiesof old cars are destroyed. So, if the demand increases and the supply is constant, the price will go up in a natural way. But if now we add that a lot of oil suppliers put on stock a part of theproduction just to decrease a little bit the supply, then the price will rise artificially. Sometimes it is not necessary to put a part on stock. For example; if it is a political problem betweenVenezuela (one of the bigger producers) and USA (one of the bigger consumers) or between Kuwait and Iraq (like the two wars of 1991 and 2003) then, the price of the oil will be raise a lot. Not because the...