Global importance of crude oil

The production of crude oil is vital to the global economy, as so much of modern society depends on the use of crude oil. Here are some points to be aware of.

Economic importance

  • The price of crude oil is controlled by oil companies, which means they have a great deal of influence on the global economy, and poorer countries can easily lose control of their own economy.
  • Countries that produce oil for other countries hold a great deal of political power as they can essentially ‘cut off’ other countries from the crude oil supply over any political disagreements.
  • War or a political crisis in an oil-producing country can restrict crude oil supplies, which can have a major impact on the global economy.

Environmental issues

  • Burning fossil fuels releases carbon dioxide into the atmosphere. This is widely accepted as a major contributor to global warming.
  • Oil spillages can have a disastrous effect on the local environment, killing off thousands of animals such as fish and sea birds, and require a great deal of effort to clean up.
  • Oil refineries and oil-fired power stations take up a lot of land and so destroy potential wildlife habitats and spoil the countryside. However, this problem is the same for any industrial site and so is not just a problem for the oil industry.