The document discusses the history of oil prices from the 1800s to the present. It notes that the modern oil industry began in Baku in 1837. In the late 1800s, the first commercial oil refinery was established and a single oil field in Baku accounted for over 90% of the world's oil production. The document then outlines major events and discoveries that impacted oil prices such as the Gulf Wars, the Iranian Revolution, and the increased shale oil production in the US that helped reduce prices in recent years. Political events and shifts in demand are cited as largely explaining major oil price fluctuations over the past few decades.

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Oil price: The pastOil price: The past
Zeeshan AhmadZeeshan Ahmad
Student, University of MiskolcStudent, University of Miskolc
Computer Application-1Computer Application-1

2. 1800 - 1869: The early crude oil industry1800 - 1869: The early crude oil industry
 The modern oil industry can trace its origins to BakuThe modern oil industry can trace its origins to Baku
in 1837.in 1837.
 First commercial oil refinery was established to distilFirst commercial oil refinery was established to distil
oil into paraffin (used as lamp and heating oil).oil into paraffin (used as lamp and heating oil).
 A single oil field in Baku accounted for over 90% ofA single oil field in Baku accounted for over 90% of
the world’s oil production, mostly going to Persia.the world’s oil production, mostly going to Persia.

3.  Commercial oil wells soon followed in PolandCommercial oil wells soon followed in Poland
(1854), Romania (1857), Canada (1858) and(1854), Romania (1857), Canada (1858) and
Pennsylvania, USA (1859), sparking a ‘blackPennsylvania, USA (1859), sparking a ‘black
gold’ rush in several of these regions.gold’ rush in several of these regions.
 Prices rose quickly – from roughly $0.49 a barrelPrices rose quickly – from roughly $0.49 a barrel
in 1861 to $6.59 a barrel in 1865.in 1861 to $6.59 a barrel in 1865.
33

4. 1870 - 1913: Birth of the modern oil1870 - 1913: Birth of the modern oil
industryindustry
 In 1870, John D. Rockefeller incorporatedIn 1870, John D. Rockefeller incorporated
Standard Oil Co. in Ohio.Standard Oil Co. in Ohio.
 Standard Oil expanded across the country andStandard Oil expanded across the country and
began exporting to overseas markets includingbegan exporting to overseas markets including
China.China.
 It was so successful that by 1890, it controlledIt was so successful that by 1890, it controlled
nearly 90% of refined oil in the US.nearly 90% of refined oil in the US.
 Prices fell globally from $2.56 a barrel in 1876Prices fell globally from $2.56 a barrel in 1876
to $0.56 in 1892, as production expanded into $0.56 in 1892, as production expanded in
both the US and Russia.both the US and Russia. 44

5. 55

6.  1.Oil boom and US Civil War - 1862-18651.Oil boom and US Civil War - 1862-1865
 2. Discovery of oil at Spindle top - 19012. Discovery of oil at Spindle top - 1901
 3. World War I - 1914-19183. World War I - 1914-1918
 4. West coast gas famine - 19204. West coast gas famine - 1920
 5. Beginning of the great depression - 19295. Beginning of the great depression - 1929
 6. World War II - 1939-19456. World War II - 1939-1945
 7. Suez crisis - 19567. Suez crisis - 1956
 8. Yom Kippur War - 19738. Yom Kippur War - 1973
 9. Iranian revolution - 1970-19809. Iranian revolution - 1970-1980
 10. Iraq-Iran War- 1980-198810. Iraq-Iran War- 1980-1988
 11. Gulf War - 1990-199111. Gulf War - 1990-1991
 12. Asian financial crisis - 199712. Asian financial crisis - 1997
 13. Iraq War - 2003-201113. Iraq War - 2003-2011
 14. Arab Spring - 2010-201214. Arab Spring - 2010-2012
66

7. 1914 - 1949: Wars, discoveries and oil1914 - 1949: Wars, discoveries and oil
crisescrises
 World War I drove global demand for oil and causedWorld War I drove global demand for oil and caused
prices to rise from $0.81 a barrel in 1914 to $1.98 inprices to rise from $0.81 a barrel in 1914 to $1.98 in
1918.1918.
 Demand after the war was driven by the ever-Demand after the war was driven by the ever-
increasing popularity of carsincreasing popularity of cars
 Price surged to $3.07 a barrel, falling back to $1.61 byPrice surged to $3.07 a barrel, falling back to $1.61 by
1922 as production increased.1922 as production increased.
 Major discoveries were made in Venezuela (1922),Major discoveries were made in Venezuela (1922),
Iraq (1928), the USSR (1929 and 1932-34), east TexasIraq (1928), the USSR (1929 and 1932-34), east Texas
(1930), Kuwait (1938) and Saudi Arabia (1938), and(1930), Kuwait (1938) and Saudi Arabia (1938), and
the first modern offshore rig was launched in the Gulfthe first modern offshore rig was launched in the Gulf
of Mexico (1947).of Mexico (1947). 77

8.  The Texan oil discovery created an oil glut thatThe Texan oil discovery created an oil glut that
coincided with the Great Depression, sending pricescoincided with the Great Depression, sending prices
from $1.19 in 1930 to $0.65 in 1931.from $1.19 in 1930 to $0.65 in 1931.
 Global prices increased from an average of $2.48 inGlobal prices increased from an average of $2.48 in
1972 to $11.58 by 1974 (and much higher in some1972 to $11.58 by 1974 (and much higher in some
parts of the US).parts of the US).
 Prices rose rapidly from 1979-80, reaching $36.83,Prices rose rapidly from 1979-80, reaching $36.83,
as Iran cut production and exports during itsas Iran cut production and exports during its
revolution and the Iran-Iraq war began.revolution and the Iran-Iraq war began.
88

9.  In 1990, Iraq invaded Kuwait, and the ensuing Gulf WarIn 1990, Iraq invaded Kuwait, and the ensuing Gulf War
created a supply shock that sent prices from $14.98 acreated a supply shock that sent prices from $14.98 a
barrel before the invasion to $41.00 per barrel inbarrel before the invasion to $41.00 per barrel in
September 1991.September 1991.
99

10. 2003 - present: A changing landscape2003 - present: A changing landscape
 The US invasion of Iraq in 2003 createdThe US invasion of Iraq in 2003 created
uncertainty about the future supply of oil.uncertainty about the future supply of oil.
 Asian demand (driven by China) increasedAsian demand (driven by China) increased
massively, contributing to a rise from $28.38 inmassively, contributing to a rise from $28.38 in
July 2000 to over $146.02 in July 2008.July 2000 to over $146.02 in July 2008.
 In recent years, technological advancementsIn recent years, technological advancements
have facilitated increased US shale oilhave facilitated increased US shale oil
production through hydraulic fracturing. Thisproduction through hydraulic fracturing. This
has reduced OPEC’s influence and causedhas reduced OPEC’s influence and caused
prices to fall – from $114.84 per barrel in Juneprices to fall – from $114.84 per barrel in June
2014 to under $28.47 in January 2016.2014 to under $28.47 in January 2016.
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11. 1111

12. ConclusionConclusion
 According 2016 survey of the academic literature finds thatAccording 2016 survey of the academic literature finds that
"most major oil price fluctuations dating back to 1973 are"most major oil price fluctuations dating back to 1973 are
largely explained by shifts in the demand for crude oil.largely explained by shifts in the demand for crude oil.
 The price of oil has also increased at times due to greaterThe price of oil has also increased at times due to greater
"demand for stocks (or inventories) of crude oil."demand for stocks (or inventories) of crude oil.
 In particular, political events can have a strong influence onIn particular, political events can have a strong influence on
the oil price.the oil price.
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14.  RefrencesRefrences
 https://oilprice.com/Energy/Crude-Oil/The-First-Oil-https://oilprice.com/Energy/Crude-Oil/The-First-Oil-
Shock.htmlShock.html
 https://www.ig.com/uk/commodities/oil/history-of-https://www.ig.com/uk/commodities/oil/history-of-
crude-oil-pricecrude-oil-price
 http://www.globalpetrolprices.com/articles/28/http://www.globalpetrolprices.com/articles/28/
 http://www.pdviz.com/historical-crude-oil-prices-http://www.pdviz.com/historical-crude-oil-prices-
1861-to-20091861-to-2009
 https://en.wikipedia.org/wiki/Price_of_oilhttps://en.wikipedia.org/wiki/Price_of_oil
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