6 pages/≈1650 words
Business & Marketing
The Oil Prices and its Implication to the World Economy (Research Proposal Sample)
The paper was a research proposal on The Oil Prices and its Implication to the World Economy source..
Studentâ€™s Name: Professorâ€™s Name: Course: Date: Research proposal Research Title: The Oil Prices and its Implication to the World Economy Introduction Oil is a valuable Commodity that has revolutionized the daily lives of human beings. Further, the availability of oil influences both macro and micro performance of the economy since major decisions on trading, finance and lifestyle revolve around oil products. However, since the year 2003, the world market oil prices have steadily cascaded, thus, affecting the producing countries and instigating hoarding from oil cartels (Painter12). Hence, it is imperative to understand the surging oil prices situation and develop a better module such as shale oil for the future UK economic prosperity. Therefore, this research proposal aims at examining an in-depth analysis of the surging oil prices to the world market and its implication to the UK economy. Through an extensive literature review of OPEC reports, exploratory methodology, a quantitative data analysis, the paper will then provide a summary of findings. Justification of the Topic In the UK, oil companies have gone bankrupt and more than 2000 oil company employees have lost their jobs since the year 2014. Further, this has affected the GDP of European countries as well as oil producing nations. The cause of this pandemonium is the drop in Oil prices since the year 2014. Currently oil prices per barrel are trailing at 43 dollars and in some cases such as American Bench mark, the price is at 40 dollars. This is a significant drop from the initial price of about 90 dollars in the year 2013. As the residents of United Kingdom who are affected by the oil prices, it is vital that we recognize the circumstance. First, the surge in inflation is connected to the trade policies of nations. Evidently all consumable goods are currently double the prices as compared to a decade ago (Mufson 28). For example, the price of gasoline, natural gas, and basic social amenities have doubled their prices. All this is instigated by the surge in oil price that implicates a chain of consequence into the normal life of UK citizens. Further, this is the real life situation; hence, efforts must be made through research to address the cause of the oil prices so as to make UK Great again and the world a better place. Statement of the Problem Which strategies can be utilized by international bodies, entities, and oil producing nations to control the market and stabilize the price so as to restore the world economy? Further, should developing countries , which are mainly consumers of oil products developa more rigorous alternative source of energy like shale oil. Besides, can these alternative sources of energy provide a concrete solution to the surging oil price and positively restructure the oil market? Research Objectives * The fundamental objective of the research is to examine the contributing variables to the rise in oil prices and how it influences the economy. * The paper will also aim to analyze the economic relation between oil producing nations and consumer nations, specifically within UK so as to establish the influence of oil products in the coexistence. In this case, crucial economic variables such as level of inflation, interest rates, and monetary policies will be examined. * The paper will further explore the oil trading policies in the international market as defined by OPEC (Organization of PetroleumExporting Countries) and the role of an alternative energy source such as shale oil to USA economy. * Finally, the paper will aim at providing analytical findings to help in creating awareness and solve the future challenges of unsteady global oil prices. Literature Review Though an enormous amount of research reveals that oil price increases have a certaindepressingforce on real GDP growth, there is a sizable debate that exists regarding the stability and strength of the relation between GDP and oil prices. Remarkably, some analysts affirm that the estimation in linear relations between oil prices and several macroeconomic variables have surged to the fore in a much weaker way since the 1980s. Again, the evidence of a weakening impact of oil price changes on themacroeconomy in information since the 1980s has occurred with another change in the nature of oil price campaigns. Conversely, before 1981, several big oil movements were headed in the positive direction. However, since that time the prices of oil have gone in both directions, painting a picture of endogenous macro developments in oil prices. Towards the end of 1985, Saudi Arabia gave up on its role as the price setter. Equally important, prices went low dramatically early in 1986, and the volumes that were in demand recovered in slow degrees in the subsequent years especially those for Saudi oil. Again, the oil price decline of 1986 saw OPEC abandon the producer controlled pricing mechanism and be content with a more market-relatedmechanism of setting up the price.For several developing countries, the ever increasing oil prices in the past few years have made structural reforms in the domestic petroleum pricing systems a critical element of their macroeco...
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