Future Supply and Demand for Crude Oil

Price per barrel (2208) Daily US demand for crude oil (in millions of barrels per day) Daily US supply of crude oil (in millions of barrels per day)

$25.00 1.0 0.5

$30.00 0.9 0.6

$35.00 0.8 0.7

$40.00 0.7 0.8

$45.00 0.6 0.9

$50.00 0.5 1.0

$55.00 0.4 1.1

1. Based on the information provided from the International Energy Agency (IEA) in the table on the left, examine the supply and demand graph in the space below. This information is helpful for our client ExxonMobil to know how much oil to produce. The graph shows crude oil prices per barrel and the supply and demand for the number of barrels in the united States per day. After you have examined the graph below, identify the price and quantity and price at which equilibrium exists. This information is important for the client to determine the quantity of oil to produce for profit maximization.

2. The global demand for oil changes with the changes in global economies. As economic activity increases, the global demand for oil increases. For the past several years, the global demand for oil has increased (https://www.iea.org/oilmarketreport/omrpublic/). As the global demand changes, we can observe this change graphically. What changes are expected in the short-term? To answer this question, please see https://www.eia.gov/outlooks/steo/.Support your statements with research and references.

3. What are potential supply and demand risks in the global oil market? Support your statements with research and references.

4. Is the global oil and gas market in a monopoly, oligopoly, or competitive economic model? Why? Support your statements with research and references.

5. To what extent do you think that the current Covid-19 pandemic crisis will impact the global oil market in the long run and more specifically are there implication for Exxon Oil?

Be as descriptive as possible and credit any sources you use.