The Impact Of Oil Prices In Saudi Arabia
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5 Pages
Oil prices have been dropping drastically. One oil barrel used to cost over 100 dollars, and now one costs about 30 dollars. People still use oil, for cars and heating, but the demand is dropping. While the demand drops the supply continues to grow, causing the prices to plummet more and more every day. Burning oil is bad for the environment. It pollutes the air, and contributes to global warming. Alternative fuels are becoming more common, which is causing the demand for oil to drop. Large oil producing countries, such as Saudi Arabia, are also playing a major role in the dropping oil prices. They disregard the Organization of Petroleum Exporting Countries ( OPEC) advice to stop oil production. It does not look like there are going to be any
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Countries need to stop pumping oil, so that supply decreases in turn raising the price. Saudi Arabia is one country that refuses to stop drilling. Many countries, including Saudi Arabia, agreed to the global climate change accord. The accord said that the countries would generate less hydrocarbon fuels in the second half of the century. They are doing this so that they do not produce carbon dioxide that could harm the trees. This is an enormous problem for Saudi Arabia because oil is 85% of their revenue (Reed). Saudi Arabia wants to continue pumping oil and make as much money as they can, in the time that they have left. The more oil Saudi Arabia produces the lower the price of oil becomes. Saudi Arabia has convinced its allies Kuwait, United Arab Emirates, and Qatar to continue to produce oil too (Fawaz). This is causing a large surplus of oil that is rising every day. Oil prices will continue to drop unless these countries stop producing so …show more content…
Technology will continue to expand, finding new ways to drill for oil. New more fuel efficient cars, and new ways to heat people’s homes will be invented. People will continue to switch to natural gas. Meaning the demand for oil will continue to decrease. Also as long as Saudi Arabia refuses to stop production, the price of oil will not increase. Later, when the climate change accord is put into action, the price of oil may increase slightly, because Saudi Arabia will be forced to produce less oil. It is also predicted that people will drive less in 2040 than they do today, which will decrease the amount of oil used. The economy is changing, and consumers are not as dependent on oil as they had been, but the producers are still rely on the profit from
Countries need to stop pumping oil, so that supply decreases in turn raising the price. Saudi Arabia is one country that refuses to stop drilling. Many countries, including Saudi Arabia, agreed to the global climate change accord. The accord said that the countries would generate less hydrocarbon fuels in the second half of the century. They are doing this so that they do not produce carbon dioxide that could harm the trees. This is an enormous problem for Saudi Arabia because oil is 85% of their revenue (Reed). Saudi Arabia wants to continue pumping oil and make as much money as they can, in the time that they have left. The more oil Saudi Arabia produces the lower the price of oil becomes. Saudi Arabia has convinced its allies Kuwait, United Arab Emirates, and Qatar to continue to produce oil too (Fawaz). This is causing a large surplus of oil that is rising every day. Oil prices will continue to drop unless these countries stop producing so …show more content…
Technology will continue to expand, finding new ways to drill for oil. New more fuel efficient cars, and new ways to heat people’s homes will be invented. People will continue to switch to natural gas. Meaning the demand for oil will continue to decrease. Also as long as Saudi Arabia refuses to stop production, the price of oil will not increase. Later, when the climate change accord is put into action, the price of oil may increase slightly, because Saudi Arabia will be forced to produce less oil. It is also predicted that people will drive less in 2040 than they do today, which will decrease the amount of oil used. The economy is changing, and consumers are not as dependent on oil as they had been, but the producers are still rely on the profit from