The decline in our U.S. dollar is also another reason because the currency is what we use to traded for oil. Also, fluctuating prices because of the disruptions we are having in other countries that are our major exporters. Some of the gas prices are due to the change in season and holidays also, because we are expected to shop and spend more so gas price go up. The change in crude oil plays a big part in why the prices are fluctuating. Crude oil is determined by supply and demand, with the influence on OPEC which is up to them to determine who to sell and produce too.
The supply of gasoline is high which will increase the price. The supply can be reduced due to the refinery production problems. This will cause wholesalers to bid higher for available supply and charge consumers a higher price for gasoline. In 2008, ocean tankers transported about 67% of imported crude oil process by U.S refineries (1). The distance from the supply can affect the price because the farther it is sold from the source, the more it will
The negative geopolitical impacts include the deterioration of political relations between countries as countries may fight over resources, as well as the over-reliance on countries that is rich in oil, resulting in a group of countries rising in terms of political influence due to their control over oil supply. On the other hand, I will also discuss the increasing demand of oil has resulted in governments investing in research and development for alternative energy resources as well as the encouragement of resource conservation. Also, due to an uneven distribution of oil, there is global income redistribution and it also forces countries to resolve political differences to secure trade relationships. I will be using case study examples from Norway, Libya, Iraq, Nigeria, United States, etc. providing a very in-depth study of the impacts of the general trend of rising demand for oil.
Research Process Paper Jaci Reedy, Renee Edwards, Javonda Keeley, Stacy Sanders, Rocio Garcia RES/341 December 5, 2011 John Gilpin Introduction Natural disaster, economic crises, and many other factors have led to a high increase in price for gas. Americans from walks of life are feeling the constraints as the prices of gas increase and remain high. The more money that Americans have to spend on gas is taking away from the amount of money they could be spending to put back into the economy. In the wake of the rising gas prices the economy is feeling the constraints as fewer consumers are spending their money in stores. Many Americans are upset by the government not releasing the oil reserves but the amount of time it has taken to build up that reserve will deplete in the amount of time that Americans would dry that reserve out.
In the first half of the year earnings for the Resources division have increased, due to higher export coal prices. * Operating in many different geographical areas * Being dependent on customers and supplier chains in each local and overseas areas, as well as different geographical areas of operations. This increases inherent risk due to difficulty to control operation in different locations as well as the climate changes in regards to their products. II. Unusual pressure on management The management is under unusual pressure to perform well and increase returns for shareholders in order to gain more remuneration: * Objective to provide a satisfactory return to shareholders, this would increase inherent risk due to pressure placed on management in order to meet budgets or forecasts * Remuneration plans * Also the directors have significant remuneration plans – they are awarded a lot of
The extremely high gas prices are killing our chances of us getting anywhere expeditiously. CNN reports that gas prices are rising nationally with an average of $0.30 more per gallon. This is one of the greatest gas price raises in the current
To increase their financial performance the company should increase their financial leverage and rely on more debt to finance their assets. The average return on equity for Costco between 1999 and 2008 was .92 compared to the industry average of 1.19. Costco’s below average return on equity is mainly because of its profit margin. Since Costco’s profit margin is significantly below the average, it is affecting the company’s return on equity. In order for Costco to improve on their financial performance, the company needs to handle their cost associated with their operations.
Another global player are the OPEC nations. These nations have major reserves of oil, therefore can set the price of oil in its member countries. This has led to prices of oil changing, having periods of very high prices and periods of very low prices. For example, Saudi Arabia has 22% of worldwide oil reserves, meaning they can sell their oil globally to countries with smaller oil reserves meaning they can make a large profit. Nationally, different Governments are involved in the global supply of energy.
In 1980, with the influx of North Sea oil, the pound appreciated strongly relative to currencies in which Massey sold its products. Lack of alignment between production sites and market also lead to currency losses. As engine production was heavily concentrated in the United Kingdom, strong British pound increased Massey’s cost of goods sold from U.S.$2381.8 millions in 1979 to U.S.$2568.5 millions in 1980 and hurt the profit margin. Another factor was high interest rate .From the income statement (Exhibit 2), it illustrated that the interest expense rose from U.S.$128.8 millions in 1979 to U.S.$229.9 millions in 1980 despite the improvement of net sales. The high interest rate of 1979 and 1980 had a negative impact on Massey’s sales performance.