The age of oil

02:06 Mins Read

This video takes you through the history of oil

Transcript

Crude oil is a widely used fuel today. But it had humble beginnings. The birth of the modern oil industry can be traced back to the 19th century.
During the late 1800s and early 1900s, many modern oil wells were drilled in America.
Seven international oil companies (IOCs) were set up, and together, they were known as the Seven Sisters. These companies included BP, Chevron, Exxon, Gulf Oil, Mobil, Royal Dutch Shell and Texaco.
Then, World War I happened, and the price per barrel of oil rose from $0.81 in 1914 to $1.98 in 1918.
Prices then stabilized for a brief period, and more countries began to discover oil reserves in their lands.
And then, World War II came along in 1939, once again creating an increase in the demand for oil.
After the war, control over the oil market remained divided between the US and the USSR.
In the 1960s, the Organization of Petroleum Exporting Countries (OPEC) was formed with 5 member countries - Kuwait, Iran, Iraq, Saudi Arabia and Venezuela.
The influence soon shifted from the US-USSR band to OPEC - which includes 15 member countries today.
Going forward, the prices of crude oil will depend on many factors like the demand in Asian countries, the OPEC coalition and USA’s production of shale oil, which is a crude oil substitute.
Crude oil is an important commodity that is traded in the financial markets today.
To learn about how you can trade in this commodity, head to the next chapter.

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