Coronacrisis! Or oil crisis? He who controls oil controls the market.

Corona! The most mentioned topic by far in any media lately. Especially on social media. While we all are afraid for Corona, there's something happening in the background. 

OPEC is ending. A trade agreement between oil nations. Excluding bigger nations like USA, Russia and Norway. While other oil nations like Iran, Iraq, Kuwait, Saudi Arabia, Venezuela, Qatar (until 2019), Indonesia (until 2016), Libya, UAE, Algeria, Nigeria, Ecuador (until 2019), Gabon, Angola, Equatorial Guinea and Congo are all part of the OPEC agreement. Limiting their supply amount and asking price. Thus making them dependend on the international oil market. ExxonMobil (part of the "seven sisters") is the unmentioned spokesperson in the OPEC agreement and international oil price.

Qatar left the oil deal in January 2019. This had a big impact on the OPEC deal. Since Qatar being such a big player on the oil market.  

The OPEC agreement ends at 1st of April 2020. This opens a door for many countries to sell oil at lower prices. This way they could outcompete countries like USA. For China it means the opportunity to buy oil at cheaper prices to produce petroleum products. For the west it means we will not be able to sell oil at the same rates we used to do. Meanwhile we are worrying about Corona, and our stock market would have collapsed inevitably at the 1st of April. Trump is trying to make a deal with Saudi Arabia for keeping oil prices up, yet Qatar and its allies, like Russia, are not interested in selling oil for 65 dollars a barrel... this means a collapse for many countries in the oil business. This could be the reason why Norway was already investing in other minerals and commodities. Plus trying to get "closer" with Russia. Probably also the reason why the big corporations of the west are investing big time in "environment" and windmills or alternative fuel solutions. If they can prevent the sale of oil, they can prevent the loss of total market control. Most of our markets are dependent on the oil price. He who controls the fuel (oil for now) controls the start of the production line. Basically everything we have in our house is connected to oil. 

Above you can see the famous crude oil tree. It shows us the importance of oil in our modern consumerism. From raw material to retail shop or consumer. Everything involves oil. From the consumer driving to the store, with gasoline in a manufactured car; to production of the consumed goods in a factory with heavily oil depended machines.

All this is controlled by a few companies know as the "Seven Sisters" (Exxon, Mobil (now ExxonMobil), Chevron, Gulf Oil, Texaco, BP and Shell) or big oil.

Thanks for reading, and I hope this gives the Coronacrisis more meaning economically. 

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