The fast decrease in the price of oil was caused by the cut in price of the largest oil export country, Saudi, as a strategy to compete with the increasing U.S. production. While car owners are glad, which is the obvious, let us take a look at the winner and the losers of this event. The list of the winners of this drop in price starts with airline companies. Airline stocks responded to this market action with almost instant rise in prices; Delta Air Lines stock price raised 4.2 percent as a result. Also as mentioned, car owners are now more gladly to do an extra Sunday drive. Among the stakeholders many have a lot to lose. For instance, other energy was disrupted by this turmoil, reflected in their substantial fall in stock prices. However, one stakeholder in particular, is more troubled than the other, Russia. As the world’s second largest oil export nation this news would devastate the nation’s income and therefore affect the Russian government’s budget. Although the bad seems to outweigh the good at the moment, it is optimistic to assume that the economic benefit in the future this event will bring. The drop in oil price would ultimately make the consumers’ pockets deeper and therefore increase their buying power.
Let’s take a step back and have a look at the very long run. As we all know the change in price in oil has massive impact on almost everything in the world; from a country’s budget to the cost of shipping goods, all industries and corporations are concerned parties. However, will its power diminish in the future? As technologies develop and more and more new energy companies mature, will the world one day snap out of oil’s control? Well, clean energy is a hot topic and with the emergence of oil-independent utilities such as electric vehicles, maybe in the near future the world will be rid of this environmental unfriendly raw resource.
