Over the past year the oil price has plunged. Great news if you own a V8 to travel to work in or heat your home with oil, but for most of us the negative consequences are impacting on jobs in the oil industry and for the vast companies that produce the product.
Its a simple case of supply outpacing demand and at the present time OPEC a group dominated by Middle Eastern States refuse to cut production. The North American shale oil boom has also played a part in the oversupply In 2008 the US produced around 5m barrels of oil a day, this year it is expected to pump an average of 9.2m barrels a day.
Royal Dutch Shell and BP have been hit badly by the effects of the global oversupply and as the shares of these companies are linked to the UK stockmarket, investors who have direct share investments have seen falling share values.