What moves the price of Crude Oil?The price of both BRENT and WTI Crude Oil can be
affected by a number of external factors, including OPEC, supply, global economic data, the price of the US
dollar, the development of alternative power, the price of alternative fuel sources, and various political
factors.
OPEC
OPEC stands for the Organization of the Petroleum Exporting Countries – the organization consisting of 14
of the world’s major oil-producing countries that most of the world are purchasing their oil from. When
any homeowner is buying oil, they are usually getting it from an OPEC nation. OPEC regulates the supply of
petroleum, which can have an effect on the price of oil.
Stored reserves
Oil is stored for use at a later date, or reserved for times when supply cannot keep up with demand.
Oftentimes reserves can be depleted, or accidents at facilities can lead to a loss of stored reserves that
can have an impact on the price of oil.
Global economic data
Different types of global economic data, such as data related to tariffs, debt, and even unemployment
rates can have an impact on the price of Oil, as it’s among the most important and vital energy sources
and its supply can affect many other industries that rely on it as a resource.
USD price Vs. Oil prices
The value of the US dollar can have a dramatic impact on the price of Oil via the USD trading pair. Much
like any asset paired against the US dollar, its value and power can influence the other asset it is
paired against. USD is the most common currency paired with oil and other commodities.
Development of alternative power
As technology advances and the need for cleaner emissions with less impact on the environment become
commonplace, this can have a dramatic effect on the price of Oil.
Prices of alternative forms of energy
Not only does the development of these new energy forms impact Oil prices, but the prices of these new
forms of power can have an adverse effect. The more the price of these new forms of energy comes down, it
could reduce countries buying crude Oil stock and thus cause supply to outweigh demand.
Political factors
Political factors, such as war, trade tensions, and more can have an enormous impact on the price of oil,
especially if any of the OPEC nations are involved. These countries can influence the price of Oil across
the globe, and oil is often used as a bartering chip.