Oil prices have hit a five-year low and shock waves are reverberating throughout the global economy. Some nations are already feeling the squeeze, while others are likely to be facing a major long-term aftermath. What processes has this price plunge set in motion? Which economies will benefit and which will lose out? What lies ahead for the global oil business?
Despite all the panicky fuss over the slumping crude oil benchmarks, their prices still remain high by historical standards, with analysts also noting the cyclical nature of the oil market throughout its century-and-a-half-long history.
The winners of the big oil game are primarily large oil-consuming nations, in particular those that have a very high share of oil imports like Japan, China and Singapore.
The dramatic movement in crude oil prices poses a challenge for shale oil, which has fueled the US oil boom. According to the Energy Information Administration, currently the US produces almost twice as many barrels a day of crude oil versus the mid-2000s – all thanks to the shale oil revolution.
The greatest oil price plunge in five years, which was prompted by OPEC’s most recent decision, has created winners and losers. On the face of it, the picture is pretty simple: the winners are the nations that import oil, and the losers are those that export the black gold.