7 Things You Must Know About the Price of Oil

3. Technology affects the price of oil

Oil is traditionally measured in barrels, and 1 barrel equals 42 gallons. Oil experts say that there are about 1.3 trillion barrels of oil in the world today and we have seen proven global oil reserves advancing rapidly depending on technology and its integration into large oil discovery regions. For example Venezuela currently has the largest proven oil reserves, then Saudi Arabia and then Canada (mostly because of the Oil Sands). Saudi Arabia, was known as the king of the global oil plays and has always been number one but it has lost that position to Venezuela because of advances in technology.

Technology is the driving force of future oil plays and the price of oil is dramatically impacted by that. Oil prices go down with market supply. Technology advances market supply, so as in the case of Fracking, the technology was so successful that we increased the oil market supply so profoundly that the price of oil dropped dramatically – hence the $45/barrel oil we see today. (August 2015)