Crude Oil prices are expected to stay high for a long time as the global demand for crude oil is still on the rise. The price of crude oil is expected to remain above $50 a barrel for quite some time. However, if we look at recent history we can see that prices of crude oil fell down to less than $40 and are expected to fall even further. Now, with the situation in the Middle East and Venezuela, there is no room for complacency in the future.
It is really unfortunate that there is an ongoing recession in countries like India, Indonesia, China, Russia, Venezuela and the other developing countries, which are the main consumers of crude oil products. Oil prices have declined more than 15% from its peak in mid 2020. Most of the developed world is still waiting for the price of crude oil to rebound and recover to its original levels. The market experts believe that oil prices will remain high until the end of this year.
To determine the resilience of crude oil prices, we need to understand the reasons behind the drop. There is an increase in the production of crude oil by countries like Iran, Iraq and Nigeria, which are producing their own oil. These countries have been increasing their production because of economic pressures and they have also been increasing their imports of crude oil to meet their domestic demand.
As a result of these increased production and imports of crude oil in order to meet their domestic requirements, the supply of crude oil in the market has decreased and it has caused the price of crude oil to drop down. It is very important for the oil companies to increase their production and to increase the demand for their product in order to offset the drop in the production of crude oil in the market. Since the demand for crude oil is not growing anymore, it is not surprising that the price of crude oil is not going up at all.
The current situation in the world is such that there is little scope for any country to increase the production level of its own oil and it is very unlikely that a country will increase its consumption either. in order to increase its production or to increase its consumption. Therefore, it is expected that the price of crude oil will be kept at the same level for quite some time. and the production level of production will be very low for the next few years.
In fact it is a very strong indication that the current scenario of oil prices is very vulnerable and prone to drastic change. Crude oil prices can continue to stay high or drop further and that could have a direct impact on the economy and the financial stability of countries like India, Venezuela and other developing countries.