Complete List of Factors that Influence Oil Prices

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Written By
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Written By
Dan Buckley
Dan Buckley is an US-based trader, consultant, and part-time writer with a background in macroeconomics and mathematical finance. He trades and writes about a variety of asset classes, including equities, fixed income, commodities, currencies, and interest rates. As a writer, his goal is to explain trading and finance concepts in levels of detail that could appeal to a range of audiences, from novice traders to those with more experienced backgrounds.

The following is a fairly well complete list of factors that influence oil prices. 

Many things influence prices and many things are dependent on other things. 

Let’s take a look. 

Factors Affecting Oil Prices

  1. Global supply and demand for oil
  2. Political instability in oil-producing countries
  3. Geopolitical tensions and conflicts
  4. Production cuts or increases by OPEC and other major oil-producing countries
  5. Influence of major oil-consuming countries
  6. Changes in currency exchange rates
  7. Economic growth and recession
  8. Environmental regulations and trade policies and tariffs
  9. Technological advancements in the energy sector
  10. Natural disasters and extreme weather events
  11. Investment and speculation in the oil market
  12. Inventory levels of oil and petroleum products
  13. Production costs
  14. Refinery shutdowns or maintenance
  15. Transportation costs and infrastructure
  16. Government subsidies and taxes
  17. Environmental disasters such as oil spills
  18. Alternative energy sources and their costs
  19. Market speculation and manipulation
  20. Oil storage capacity utilization
  21. Global economic trends and changes
  22. Wars, sabotage (e.g., Abqaiq in 2019), and terrorist activities
  23. Oil reserves, discoveries, and exploration
  24. Use of oil derivatives and futures markets (affect hedging arrangements in the cash market, and therefore prices)
  25. The global political environment
  26. Changes in weather patterns
  27. Competition from other energy sources
  28. Access to and control over oil resources
  29. The role of international organizations such as the IMF and World Bank
  30. The role of global financial markets on oil prices
  31. The impact of sanctions and embargoes
  32. The influence of major oil market players such as national oil companies (i.e., the role of oil producing countries’ state oil companies in setting prices), and large oil firms
  33. The impact of public opinion and activism on oil consumption
  34. The influence of automation and digitalization on the oil industry
  35. The impact of public policy on oil consumption and production
  36. The effect of oil prices on consumer behavior and industries.



This is a list of factors that can influence oil prices.

However, it is worth noting that the oil market is complex and dynamic, with many factors influencing prices simultaneously and often in unexpected ways.

Also, the weight of each factor may vary depending on the historical and current context.