Kuilong - Kuilong shao 1 Collapse of Oil Prices An article...

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Kuilong shao 1 Collapse of Oil Prices An article posted on the Wall Street Journal on 14 th of May, 2015, reflects on the IMF outlook regarding the collapse of the world’s oil prices. Accordingly, the study tried to explain how the oil prices were affected by both the forces of demand and supply. The IMF observed the prices into two phases from July to October of 2014 and from October 2014 to January 2015. The IMF observed the changes in both oil prices and stock prices daily and made some assumptions. Accordingly, if the stock prices and the oil prices both declined it appeared that the global demand was weak. On the other hand, if oil prices dropped and the stock prices were on the rise, then the IMF assumed an increment in oil supply. These two forces explained the plunge of oil prices (Zumbruni, Para 1-4). The results indicated that during the first phase the oil price drop was attributed by weak global demand. For instance, crude oil declined from$ 105 to around $ 82. However, in
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