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Oil Prices Increase for Third Straight Day

While there are typically long periods of significant volatility in the financial markets across the globe, one small sector of the financial markets that has seen a lot of volatility as of late has been the oil markets. According to a recent news article (http://money.cnn.com/2016/08/15/investing/oil-prices-jump-opec-freeze/index.html) prices of oil, and particularly futures of crude oil contracts, have increased considerably in price over the past few days.

Midway through the trading day on August 15 the price of a barrel of oil for September delivery jumped to $45.50 per barrel, which was about a three percent increase over the prior trading day. This was the third consecutive day that saw a significant and similar jump in prices for future oil contracts. Overall, the price of oil had increased by about ten percent over the past three trading sessions alone.

The recent increase in oil prices comes after a significant decline in prices over the past year. The price of a barrel of oil had been cut by more than half compared to where it was just a couple of years ago. The price per barrel was very recently below $40 per barrel, which seemed to be a potential floor or stable place for the price of a barrel. There have been a number of rumors regarding why oil prices declined to begin with, which included unnecessary production of oil to make other energy sources seem less attractive than an affordable oil price.

While oil rallies are not that rare, they are typically driven by changes in demand and other factors that have a natural economic influence on the price of a barrel. However, this current rally seems to be based more on the expectation that more will be done by OPEC and oil-dependent nations to drive up the price of oil. Most specifically, it has been rumored that OPEC, Russia, Saudi Arabia, and other influential players in the oil industry could be a freeze on production, which would artificially drive down up the price of oil