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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The new drilling technology is opening up large fields of oil that we had not been able to reach in the western United States. Oil engineers use a new technique where they drill horizontally into the rock, they then pump, water, sand, and chemicals into the hole allowing the gas to come to the surface (Fahey). This is causing oil to be drilled in North Dakota, California, Texas, and Colorado. This new drilling technique is predicted to raise oil production by 20% (Fahey). An increase in oil production is harmful to the price of oil, because if there is a large supply of oil will cause a large drop in the price. The producers will be forced to lower the price of the oil in order to sell their product. Another reason that the new drilling technology is causing a drop in oil prices, is because all of the oil mined is in the U.S. There are no extra costs from importing the oil, and buying it from other countries. This causes the oil to be cheaper to make, so it can be sold for less. New drilling techniques are increasing the availability of oil, and decreasing the …show more content…
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
The new drilling technology is opening up large fields of oil that we had not been able to reach in the western United States. Oil engineers use a new technique where they drill horizontally into the rock, they then pump, water, sand, and chemicals into the hole allowing the gas to come to the surface (Fahey). This is causing oil to be drilled in North Dakota, California, Texas, and Colorado. This new drilling technique is predicted to raise oil production by 20% (Fahey). An increase in oil production is harmful to the price of oil, because if there is a large supply of oil will cause a large drop in the price. The producers will be forced to lower the price of the oil in order to sell their product. Another reason that the new drilling technology is causing a drop in oil prices, is because all of the oil mined is in the U.S. There are no extra costs from importing the oil, and buying it from other countries. This causes the oil to be cheaper to make, so it can be sold for less. New drilling techniques are increasing the availability of oil, and decreasing the …show more content…
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