The price of oil has fallen significantly since June 2014, from a
peak of US$115 per barrel (bl) then
to US$26 per barrel in January 2016,
although it has somewhat recovered
recently. This can partly be explained by weaker demand, robust supply
growth and the expanding coverage
of mandatory energy efficiency provisions worldwide. These
changes come at a time of major turmoil in parts of the Middle East.
Iraq – with the world’s fifth largest oil reserves – is engaged in the fight
against ISIL/Da’esh which controls some of Iraq’s oil fields. Syria – with a national budget largely dependent on oil revenues – is torn apart by civil war. Iran, on the other hand, is
returning to international oil markets as a result of the gradual removal of sanctions against it, in
line with the agreement on its nuclear programme.