This week marks the 10th anniversary since the start of the global financial crisis.
The Oil Research and Forecasts team at Thomson Reuters has examined what has happened to the price per barrel of oil during the last 10 years.
Shakil Begg, Head of Oil Research & Forecasts at Thomson Reuters, said: “Like other markets, oil prices have undergone dramatic changes over the past decade – some of which were directly related to the fall-out from the financial crisis; while others were caused by seismic changes in fundamentals.
“Compared to the start of August 2007, the front month Brent crude futures contract is down over 30% at current prices. However, the dramatic rise to nearly US$150 during the summer of 2008 and the subsequent price crash have seen volatility in oil spike to record highs. Global QE and OPEC’s intervention to clear excess supplies helped oil to recover, though robust emerging market demand particularly from Asia was instrumental in driving a sustainable recovery.
“The cyclical nature of the oil industry influenced price action for much of the decade as oil price shocks first curtailed investment and later drove innovation and expenditure in higher cost production. In many ways the oil market is facing similar fundamental (oversupply) concerns it faced during the end of 2008 but with economic growth and oil demand at much healthier levels, the dynamics of the industry are notably different.”
Read the article online at: https://www.hydrocarbonengineering.com/refining/10082017/financial-crisis-one-year-on/