After spending the last few years trading in a range between around $95 a barrel and $120 a barrel, the price of oil (as measured by Brent Crude) has slid sharply in the course of the past three months. The slump has come despite upheaval in the Middle East, and talk of economic recovery in the US.
What’s driving it? Despite talk of ‘peak oil’ in the past decade, the oil market is currently well supplied: America’s oil output is at its highest level in 40 years, while problems in Syria and Iraq haven’t affected major oil-producing areas. The pressure in the market was made clear at the start of this month when Saudi Arabia cut its prices rather than production.
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