What were the effects of the recent global recession on oil prices?
Demand is depressed. People and (leading countries) are tightening their belts. Next move is by OECD who might want to cut down on production. Some low-volume producers like India are looking for increasing their domestic production (without investing huge amounts) and also looking at ‘natural gas’ as an alternative. But such a switch involves considerable ‘Capital Expenses’ too. But the natural rise in demand over a period in view of increased population and rising expectations of developing economies (China & India to a large extent) will shift the geographical centre of gravity of ‘consumption’. This might be an advantage to Central Eurasian oil reserves (around Caspian Sea) but may be a disadvantage to Mexico. Nigeria may have to redraw its options. Investment in Siberia will pick up.
