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Looks good.

Analysis is there. Articles look like they'll help you write a decent report.

Time to focus on the market structure of the oil industry.

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The elasticity of demand for oil is inelastic as oil is the main source of fuel thus it is inelastic as the change % in demand is lesser than the change % in price in the short run, however in the long run demand oil is elasticity.
However the low elasticity of price in the short run of demand and supply, with other factors such high amount of existing oil reserves further push the price of oil down despite OPEC has set limit to the amount of oil each OPEC country should produce. But the agreement has not been signed as Iran did not attend the meeting and Saudi Arabia would not sign unless Iran sign it as well.
The article also state that "the strong growth in demand from China, other newly industrialized economies, and the developing Middle East itself; and the failure of global production to increase. These factors explain the initial strong pressure on prices that may have triggered commodity speculation." Even though newly industrialized economies and developing middle east need large amount of oil for its economics, but the price of oil still continue to drop due to large slurp of oil.
“According to economic theory, three restrictions of the time path of crude oil prices should hold in equilibrium, arising from storage arbitrage, financial futures contracts, and the fact that oil is a resource than can be depleted. These connect the spot price of oil today to the value that market participants expect the price to be in the future. Just as the current price of a stock reflects what people expect about future earnings, making the actual change in stock prices very difficult to predict, the current price of oil should reflect expectations of future fundamentals, making changes in the price of oil hard to predict. The broad movements of the price of oil and oil futures contracts are consistent with these theoretical restrictions.”
The price drop is due to supply is far more than demand, thus the equilibrium is off balance, as the price drop, major producing countries of oil’s revenue drop by at least 1billion usd per day for every 1$ usd/barrel decrease in oil price. In order to increase revenue, oil producing countries started to increase the production of oil in hope to increase in revenue, however the price of oil drops everytime supply of oil increases.

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The key features of any account, he writes, are the low price elasticity of demand for oil; the strong growth in demand from China, other newly industrialized economies, and the developing Middle East itself; and the failure of global production to increase. These factors explain the initial strong pressure on prices that may have triggered commodity speculation.

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in this article The Organisation of Petroleum Exporting Countries (OPEC) has stated that the demand for its oil would slightly increase to 32.6 million barrels per day (mb/d) this year from 32.5 mb/d as world oil demand growth has been projected to drop to 1.15 mb/d from 1.24 mb/d.

OPEC noted that “This, combined with the joint cooperation with a number of non-OPEC countries in adjusting production by around 0.6 mb/d, will accelerate the reduction of global inventories and bring forward the rebalancing of the oil market to the second half of 2017.” According to OPEC, the world oil demand estimated at 1.24mb/d, is backed by the fact that the transportation sector reflects low retail prices and better-than-anticipated vehicle sales.

It was stated that Asia and China saw an oil demand growth. In Latin America and the Middle East, oil requirements were lower than thought needed due to a slower economic development and a high level of substitution dampened oil consumption( with the presence of available substitutes, demand would decrease). In 2017, world oil demand is projected to grow by 1.15 mb/d. In OECD, oil demand is projected to rise in OECD Americas, flatten in Europe and continue declining in Asia Pacific.

In the non-OECD countries to growth in economy was said to help increase the overall demand of oil with Latin America and middle east being highlighted.Non-OPEC oil supply in 2016 was estimated to contract by 0.78 mb/d.
With the main contributors to this decrease being the US, China, Mexico, Colombia and other OECD Europe, while growth was anticipated to come from Russia, Brazil, Congo and the UK. Low oil prices led to a decline of 420 tb/d in US oil production.

In 2017, non-OPEC oil supply is projected to grow by 0.3 mb/d. This is mainly due to higher price expectations for 2017. The main contributors to non-OPEC supply growth are Brazil with 0.25 mb/d, Kazakhstan with 0.21 mb/d, and Canada with 0.17 mb/d. In contrast, Mexico, US, China, Colombia, and Azerbaijan are expected to show the main declines.”

This article explains how demand has a direct relationship with supply. The law of supply and demand defines the effect the availability of a particular product and the desire (or demand) for that product has on price. Generally, a low supply leads to a demand increase and in contrast, the greater the supply and the lower the demand, the lower the price tends to fall. The article has explained how the oversupply of oil as lead to a decrease in demand/ prices of oil in the world.

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The Organisation of Petroleum Exporting Countries (OPEC) has said the demand for its crude would slightly increase to 32.6 million barrels per day (mb/d) this year from 32.5 mb/d as world oil demand growth is projected to drop to 1.15 mb/d from 1.24 mb/d.

OPEC, which disclosed this in its monthly oil report for December, noted that, "This, combined with the joint cooperation with a number of non-OPEC countries in adjusting production by around 0.6 mb/d, will accelerate the reduction of global inventories and bring forward the rebalancing of the oil market to the second half of 2017."

Nigerian government has proposed a production of 2.2 million barrels of crude per day for the 2017 budget that is based on oil price benchmark of $42.50 per barrel. The estimated production level ranks Nigeria among the major producing OPEC members. The country is one of the 13 members of OPEC, which is a cartel of oil producing countries founded in 1960.
According to OPEC, the world oil demand estimated at 1.24mb/d, is supported by the transportation sector reflecting low retail prices and better-than-anticipated vehicle sales.

It pointed out: "In the non-OECD, Other Asia and China saw solid-to-steady oil demand growth. In Latin America and the Middle East, oil requirements were lower than initial projections as slower economic developments and a high level of substitution dampened oil consumption. In 2017, world oil demand is projected to grow by 1.15 mb/d. In OECD, oil demand is projected to rise in OECD Americas, flatten in Europe and continue declining in Asia Pacific.

"In non-OECD, improvement in economic activities is assumed to provide support to oil demand growth, particularly in Latin America and the Middle East. Non-OPEC oil supply in 2016 is estimated to contract by 0.78 mb/d.
The main contributors to this decline are the US, China, Mexico, Colombia and other OECD Europe, while growth is anticipated to come from Russia, Brazil, Congo and the UK. Low oil prices led to a decline of 420 tb/d in US oil production.

"Declines are also seen coming from Colombia and China, as well as Canadian conventional crude output. In 2017, non-OPEC oil supply is projected to grow by 0.3 mb/d, despite initial projections in July 2016 for a contraction (Graph 2). This is mainly due to higher price expectations for 2017. The main contributors to non-OPEC supply growth are Brazil with 0.25 mb/d, Kazakhstan with 0.21 mb/d, and Canada with 0.17 mb/d. In contrast, Mexico, US, China, Colombia, and Azerbaijan are expected to show the main declines."

However, OPEC noted that, "this forecast remains subject to a number of uncertainties, including the pace of economic growth, potential new policies and price developments."
With regards to crude oil price movements, the OPEC monthly report recalled that, November was a volatile month for crude, with the OPEC Reference Basket (ORB) wiping out gains from the previous month to plunge nearly 10 per cent to $43.22/b.

"Oil prices trended down sharply amid uncertainty surrounding the implementation of OPEC's Algiers Accord agreed upon in late September. A substantial increase in global oil supplies into a market already awash in crude also contributed to the decline in prices. Year-to-date, the ORB value was lower by 21.9per cent at $39.80/b.

"After rising to 12-month-highs in October in reaction to the OPEC decision in Algiers, crude oil futures plunged in November. A sharp increase in global oil supplies was also a contributing factor. An all-time high build of 14.4mb in US crude stocks, as well as the unexpected result of the US presidential election and the strength of the US dollar, all weighed heavily on oil prices during the month," it stated.

Nevertheless, OPEC added in the report, the oil complex still managed to soar more than 10 per cent, with futures for both benchmark crudes well above $50/b late in the month following OPEC's announcement on 30 November of a supply adjustment agreement.
According to the cartel, "ICE Brent ended $4.31 lower at $47.08/b for the month and 19.5per cent lower at $44.26/b for the year. Similarly, NYMEX WTI dropped $4.18 to $45.76/b in November and 14.3per cent to $42.68/b year-to-date.

The ICE Brent/NYMEX WTI (or transatlantic) spread narrowed further to $1.30/b, encouraging the US to import Brent-related grades such as West African crudes. Pressure on Brent relative to WTI has come from increasing production and exports of regional light sweet crudes as well as North Sea grades. Speculators bet strongly on price declines in November. Futures and options trading data indicated that money managers had boosted short positions by record amounts throughout the month.

Besides, the report stated that, in a very volatile month for crude oil, the ORB wiped out almost all its previous month's gains to end November close to 10per cent lower. "Oil prices trended down sharply a few days after having reached a 15-month high in response to the OPEC decision in Algiers (the Algiers Accord) at the end of September, which was designed to bring forward market rebalancing. "During the two weeks following the agreement, uncertainty regarding its implementation set off a sharp decline in oil prices.

A substantial increase in global oil supplies, in a market already awash in oil, also contributed to this price drop. Oversupply in oil came from an all-time high level of output by most major crude oil producers, as well as the return of lost production from turbulent areas and from planned oil field maintenance. The surprise result of the US presidential election, and the increase in the US dollar that accompanied it, also contributed to the deterioration in oil prices seen in November.

"Nevertheless, by the end of the month, the highly-anticipated announcement of a supply adjustment by OPEC of around 1.2 mb/d for the first time since 2008 - with scope for cooperation from non-OPEC - sent the oil market soaring by more than 18per cent, lifting the ORB value to its highest this year. On 2 December, the ORB value reached nearly $50/b for the first time since October last year," it explained.
Source: This Day Live

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OPEC Projects Demand for Crude at 32.6mb/d in 2017

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The Organisation of Petroleum Exporting Countries (OPEC) has said the demand for its crude would slightly increase to 32.6 million barrels per day (mb/d) this year from 32.5 mb/d as world oil demand growth is projected to drop to 1.15 mb/d from 1.24 mb/d.

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Since 2014, there has been an oversupply of oil around the world which has led to decreasing prices of oil, which has lead to OPEC (organisation of petroleum exporting countries), agreeing to a cut in supplies in 2017 of approximately 1.8 million barrels a day, in a hope to end the supply glut and ever decreasing prices. Major predictions of oil prices were between us $50 - us $60.

On the 22nd December, prices of oil in US fell to us $55 per barrel, although there has been a forecast by the American Petroleum Institute that there would be a substantial draw on US stockpiles of more than four million barrels which were causing the fifth consecutive week of falling stocks as well as supporting the ongoing price rally.

However, Energy Information Administration (EIA) has instead recorded a 2.3 million barrel increase last week, which has lead to the price drop.

The agreement to cut supplies by the OPEC cartel and Russia is vital to recover from the supply glut of oil since 2014, if the supply of oil was to keep increasing, the supply will far exceed the demand, in which case the implementation of the above would hopefully cause the demand to exceed the supply in the hopes to increase the prices of oil.

As such the following article explains the current oversupply of oil in the world, with the hopes of reducing the glut in 2017, supplies will be cut down by both OPEC and non-OPEC countries.The law of supply and demand defines the effect the availability of a particular product and the desire (or demand) for that product has on price. Generally, a low supply leads to a demand increase and in contrast, the greater the supply and the lower the demand, the lower the price tends to fall. In this case, we can see that due to the increase in supply of oil, the demand for it is reducing.

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1:http://www.theweek.co.uk/oil-price/60838/oil-price-back-above-55-after-positive-supply-data
2:http://www.hellenicshippingnews.com/opec-projects-demand-for-crude-at-32-6mbd-in-2017/
3:http://www.nber.org/digest/mar09/w14492.html

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-Elasticity of oil
-Demand of oil
-Supply of oil

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Oil's long-neglected bulls finally had reason for cheer this week, after Brent crude prices lurched to two-year highs.

Benchmark Brent rose above $59 a barrel this week, although by Friday it had slipped back to $57.58 amid profit taking.

Still, that was the fifth consecutive weekly gain, and Brent's best third-quarter performance since 2004, Reuters says. Already some analysts are calling oil at $80, according to CNBC.

The rise was in part a response to Turkey's threat to cut off Kurdish oil exports, after the Kurds voted overwhelmingly for independence. Kurdistan produces just over 600,000 bpd, or about 15 percent of Iraq's total output.

But Brent prices "have only moved up into the upper-$50s because the underlying fundamentals have improved markedly in the last few months," Oil Price says. Rising demand and flatlining global supplies, coupled with OPEC's cuts since January, seem to be finally putting upward pressure on the commodity after three years in the doldrums.

Still, OPEC shouldn't jump the gun by declaring victory, one expert told CNBC. The third quarter is typically when demand is strongest, and shale oil producers may well respond to the upward trend by ramping up supply even further. OPEC members themselves might also be tempted to capitalise on the new environment, which would quickly depress prices again.

OPEC and others have cut production by 1.8 million barrels per day, but U.S. shale producers have not held back. Their output is set to rise for a tenth month in a row in October, Reuters reports.

Oil price: WTI steady as Brent rises on hopes of Saudi output cut

8 September

The price of oil was flat in New York today, as Hurricane Irma approached the US, but rose in London, where news of a production cut led to optimism.

At 2.39pm today, West Texas Intermediate (WTI) was fetching $49.04 a barrel in the US, down five cents on its previous closing price. In London, Brent Crude was up 25 cents at $54.74.

Irma will be the second major hurricane to hit the US coast in a fortnight when it makes landfall on Florida some time between now and Sunday. Hurricane Harvey, which struck further west in Texas, shut down one quarter of US oil refining capacity.

With fewer refineries to buy oil - and with the city of Houston gridlocked and not buying gasoline - the price of crude fell. As refineries have come back on line after the stoppage the price has recovered somewhat.

It will take "weeks" for US refineries to return to full capacity, however, warns Reuters.

Brent enjoyed a rise today thanks to the news that Saudi Arabis is to cut oil supply allocations to worldwide customers by 350,000 barrels a day, says the news agency.

The collapse in the price of oil since highs three years ago has been caused by a global oversupply - with vastly too much oil on the market, the price has plummeted.

When Opec nations and other major producers announced their most concerted efforts yet to limit production last year, the price immediately rose. But the promised reduction was not as big as hoped - and oil has hovered around the $40 to $50 mark.

US production also increased earlier this year, stopping the rebalancing that some analysts had hoped for this year.

Oil price rises as US refineries restart after Hurricane Harvey

5 September

The price of oil rose higher today as US refineries reopened, following a shut-down forced by Hurricane Harvey.

At 2pm UK time today, West Texas Intermediate (WTI) had risen 73 cents on its previous closing price to $52.77 per barrel. In London, Brent Crude was up 43 cents at $48.02 a barrel, with pricing driven by hints that major producers might reduce output.

The price of refined gasoline also fell in the US as the refineries re-opened today, says Reuters. Gasoline futures were down four per cent on their last closing price at $1.69 at 2pm UK time, down from $2.17.

The tropical storm which struck the coast of Texas on 25 August took out almost one quarter of all US refining capacity, says the news agency.

Eight refineries, with the capacity to refine 2.1 million barrels per day, remained shut yesterday afternoon, according to the US Department of Energy.

It might seem logical that the price of oil would increase when production was restricted by storms. In fact it fell - partly because refineries were no longer buying and partly because America's fourth-largest city, Houston, was brought to a standstill and stopped buying gasoline.

Hints of further cuts

The price of oil in London was boosted today by hopes that Opec nations and other major oil producers might extend an agreement to cut the amount of crude oil they produce.

Oil's long price slump from highs three years ago has been caused by a huge global oversupply of the commodity: put simply, with more oil on the market, the price is lower.

Last year, Opec nations and other producers including Russia announced their most concerted efforts yet to limit production and raise the price. But factors including natural disasters and political events have conspired to keep oil around the $40 to $50 mark.

Now, says Reuters, Russia and Saudi Arabia have discussed extending the production cut, giving traders some hope for a price rally this year.

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Oil price posts two-year highs - but how long can it last?

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Oil's long-neglected bulls finally had reason for cheer this week, after Brent crude prices lurched to two-year highs. Benchmark Brent rose above $59 a barrel this week, although by Friday it had slipped back to $57.58 amid profit taking. Still, that was the fifth consecutive weekly gain, and Brent's best third-quarter performance since 2004, Reuters says.