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Crude oil: History, market trends & trading

By Hesham Eissa and Heleen Oude Nijhuis

Copy and content editing by Angela Barnes and Cathryn Atkinson


This in-depth report on the crude oil industry is the first in a new series that aims to educate investors on markets and oil trading. It looks at the history of oil as a commodity, how the oil price has changed, current conditions for the sector, and tradable assets in the oil market.

As a fossil fuel, oil – like coal and natural gas – was formed in pockets around the world, primarily from the remains of micro-organisms that lived millions of years ago, such as plants, zooplankton, and bacteria.

Crude oil as a commodity came to dominate global economies in the 20th century, fueling trade growth, transportation, homes and businesses. Its uses developed further and today it is integral to important non-fuel products, such as plastic or agricultural fertiliser for food production and medicines too.

Crude oil price fluctuations, at their core, stem from the enormous demand for black gold in many areas of life, and the ease of accessing it in order to feed that demand.

Oil price history

In the mid 1970s, there were unprecedented crude oil price rises, long queues at petrol/gas stations, fuel shortages, and market panic due to a major supply crisis felt around the world. The oil industry crisis eventually eased with increased petroleum production in places like the North Sea, but oil prices remained volatile.

A more recent significant movement in crude oil price history was in 2008 – against the backdrop of the global financial crisis following the collapse of the US home loans market. Volatility led to oil spiking to $145 a barrel, and months later it collapsed to under $40 a barrel as demand for the commodity dropped off.

US crude oil, one of the world's most valuable tradable commodities, also known as West Texas Intermediate (WTI), reached an all-time high of $147.27 per barrel during the crisis.

Meanwhile Brent Crude, typically refined in northern Europe and considered the benchmark that defines oil prices worldwide, thanks to its prominence during the North Sea oil boom of the 1980s, also hit an all-time high in 2008 of $147.02.

The next big oil price movement came during the Covid-19 pandemic starting in March 2020, when global lockdowns stopped travel and slowed demand for fuel. As a result, WTI plummeted to below $40 a barrel.

In 2022, as the world rebounded from the pandemic and demand for fuel returned with travel and industrial output, the crude oil price skyrocketed, which led to the oil market hitting near-record levels.

Demand in the oil market was further exacerbated by Russia’s invasion of Ukraine in February. That’s because Russia is a key global supplier of oil – when sanctions were imposed against the country for its actions, other nations, including those in the European Union, had to scramble to find replacements from other parts of the world, which brings us up to what happened to oil today – subsequently we have seen an upwards oil price trend with increased demand for the commodity.

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