May 8, 2010
“Crude oil prices behave much as any other commodity with wide price swings in times of shortage or oversupply. The crude oil price cycle may extend over several years responding to changes in demand as well as OPEC and non-OPEC supply”. Gas prices are raised anytime the cost of a barrel of oil goes up in price. So what causes our prices of oil to rise? This is what I will be talking about in this essay.
Oil is extracted from the ground, and is turned into several products, which then are disbursed to the public. Oil supplies two fifths of the world’s energy. “Oil seeping out of underground reservoirs has been collected and used for light throughout recorded history.” So what causes our prices of oil and gasoline to rise? The supply and demand of our oil today has a huge impact on our everyday life. With the current high prices of gasoline, it has a big impact on our economy.
“Edwin Drake dug the first modern oil well in Titusville, PA.” After he had dug 69 feet into the ground it was the first oil rush in the area. “Then in 1861 the first oil refinery was set up.” Titusville is actually about 2 hours from where I live here in Mars. I have been up there several times.
Development of the Modern Industry
“During the late 19th century many of the modern oil companies were created.” “John D Rockefeller invested in a Cleveland refinery during the Civil War and in 1870 created Standard Oil which refined 95% of the United States oil in 1880.” According to the Columbia Encyclopedia in 1911 , Standard Oil was declared illegal and split into 34 companies including Exxon in 1972. After that several more companies have gotten involved.
Late 20th Century
OPEC was formed in 1960, which stands for Organization of Petroleum Countries. After there was an oil embargo in 1973, OPEC boosted prices of oil to $35.00 a barrel in 1981. Not only did... [continues]
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