Why are the cost of oil changing?
Oil prices are in the red for the third straight day.
The price of Brent crude oil rose to $50 a barrel after a decline on Wednesday.
Brent has been falling steadily since the beginning of the year.
But as of mid-December, the price of crude oil had fallen by more than 20 percent from its peak of $113 a barrel in early January, according to data from Bloomberg.
That was the biggest drop since June 2016.
The drop has been particularly pronounced in the Middle East.
Oil production has been at an all-time high, and Saudi Arabia has the world’s largest reserves.
But in the last few months, the Saudi government has increased production to the point that it could supply a growing global demand.
The kingdom has cut production and cut prices to boost exports.
That has led to a glut in the oil market, which has been a source of concern for oil exporters.
But as the price has dropped, the demand has increased, and the Saudi oil ministry has suggested that Saudi Arabia will boost its oil production in the future.
“It will be a long, long time before the demand is so high that we can increase production,” said Mohammad al-Bashir, the deputy minister for energy and industry, in a televised interview on Wednesday, according the state news agency SPA.
Al-Basha said that Saudi production has already increased to a record high of nearly 4 million barrels per day (bpd) in December and is expected to hit 5 million bpd in 2017.
The kingdom is the largest oil producer in the world, with the biggest reserves in the Persian Gulf.
Saudi Arabia is also the world leader in producing oil from the North Sea.
In recent months, Saudi Arabia, which accounts for about one-third of the world oil demand, has been producing less than half of what it needs to meet demand.
“The price of oil has dropped by almost 20 percent,” said Steven Mufson, head of oil market strategy at Macquarie Capital in Sydney.
“We’ve had a glut.
We have to get oil producers to invest in that glut.”
“Oil demand is falling,” he said.
“Oil demand will fall in 2020, 2021, 2022.
And by 2024, 2025, and beyond.”
But the glut in demand has not gone unnoticed by Saudi Arabia.
Saudi Aramco, the state-owned oil company that owns about two-thirds of the country’s oil, has slashed production in an effort to balance its budget.
Aramco says it has cut its production by 3.2 million bdpd in the past year.
Saudi oil minister Adel al-Jubeir told Reuters in February that the kingdom had reached a point where the “demand glut” was “unacceptable.”
So what is the root cause of the Saudi shortage?
The biggest factor is the steep drop in world demand for oil.
The United States, the world economy, and Europe are in recession.
In the United States the unemployment rate is above 20 percent and the federal deficit has ballooned to more than $100 billion.
Oil prices have also been falling, especially in the European Union, which is struggling to make up lost sales and is currently paying a price for its dependence on imported oil.
Meanwhile, China is also in a recession and is struggling with an economy that is still recovering from the 2008-2009 financial crisis.
China’s economy grew 7.5 percent last year, according to Statistics Japan, but that was a year in which the country added 1.3 million jobs.
What can oil exporter countries do to get more supply?
“You need to focus on increasing demand,” Mufsson said.
Saudi Arabia and the rest of the Gulf countries are relying on oil prices to pay for imports.
“The Saudis and the other Gulf countries have been paying their oil suppliers for a long time.
So it’s really difficult to get them to increase production.
China has been spending big to get it,” Mafson said, referring to the Asian nation.
Some countries are also increasing production, such as Canada, which plans to increase its oil output by 1.5 million btpd by the end of the decade.
For now, however, the situation is not good.
“In the past, you could buy oil at $100 a barrel.
But now it’s a little bit lower than that,” Mefson said of the oil price.
“You’ve got a glut of demand, but you don’t have enough supply to satisfy that demand.”
The price has also dropped in the Asian countries, where there is less competition for market share.
Japan and South Korea have a lot of oil-exporting companies.
They are not investing in new fields or upgrading facilities.
And the United Arab Emirates has also been investing in oil production.
“They’re going to try and expand production,” Mafa said.