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Supply, demand and geopolitical tensions: How and why oil prices rise

As for what causes oil prices to rise? According to Patrick Dehaan “It’s all kind of a balancing act.” “Oil prices are very sensitive,” DeHaan said, adding that at a basic level, they are driven by “supply and demand and anything on either side of that.” “An increase in production can cause oil prices to plummet just like an unexpected outage would cause oil prices to soar,” he added.

DeHaan said, saying that markets can be unpredictable at times. “There are some expectations that the market does have … the biggest expectation is the one that the Saudis gave us which is that they will be able to restore this production within a matter of days, not weeks,” Another factor to consider is if there is another attack or a military response “that could also cause oil prices to go up just because of the risk that such action would further disrupt the normal flow of crude oil,” according to DeHaan.

 

 

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