Crude Oil market Growth and Forecast 2016 - 2024 oct 2016 | Page 2

REPORT DESCRIPTION

Global Crude Oil Market: Description
Crude oil is a naturally occurring hydrocarbon found in geological formations beneath the earth’s crust. Crude oil in both
its unprocessed and refined states is broadly classified as petroleum. Petroleum satisfies a majority of the global energy
demand. The demand for crude oil is directly proportional to the growth of global energy demand and a multitude of other
macroeconomic factors ranging from disposable income to a rate of urbanization. Crude oil is further processed in
refineries for making a large number of consumer products such as gasoline, kerosene, plastics and chemicals among
others. The overall demand drivers for crude oil can be sub-divided into the individual demand growth of crude oil end use
areas. One of the major uses of crude oil is for the manufacturing of gasoline. Countries such as the U.S. utilize nearly
45% of their entire oil requirement for making gasoline and fuelling their ever growing transportation sector. This trend is
now being replicated most by the emerging economies of South America and Asia-Pacific.
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Global Crude Oil Market: Drivers and Restraints
Growing disposable income and reducing costs of automobiles have increased gasoline demand manifold in these regions.
The growing medium and heavy duty vehicle market are also increasing the consumption of diesel in the aforementioned
countries. Until a cost effective transition to cleaner fuels is achieved, the global transportation sector will continue to
increase the demand for crude oil. Other transportation sector applications involve its use as a bunker fuel for the marine
transport sector and as jet fuel for the aviation sector. With increasing demand of petrochemical products, the growing
demand for crude oil is inevitable. Detergents, plastics, synthetic rubber and synthetic fibers are some of the major end
use segments of crude oil. Growing demand in the fertilizer and pesticide market is also stimulating the demand for crude
oil to a large extent. Crude oil can be measured in terms of sulfur content as sweet and sour. Sweet crude has a lower
sulfur content which progressively increases in sour crude. Crude oil can also be segmented on the basis of API gravity as
light and heavy. Crude oils with higher API gravity are lighter and vice versa. The crude oil market can be segmented on
the basis of type as Brent Blend, Russian Export Blend and West Texas Intermediate (WTI) among others. Brent Blend
crude oil is used for pricing nearly 60% of the global crude oil traded. These segments are used for determining the price
of crude being traded on a daily basis.
Global Crude Oil Market: Geographical Dynamics
In terms of crude oil production the Middle East is the market leader with Saudi Arabia producing the most crude. The
Europe and Eurasian region closely follows with the Russian Federation as one of the major contributors. In terms of crude