StudentShare solutions
Triangle menu

Oil Market in The Azerbaijan Republic - Essay Example

Not dowloaded yet

Extract of sample
Oil Market in The Azerbaijan Republic

It also contains the world's largest deposits of natural gas (Energy Information Administration 2008).
The breakup of the former Soviet Union has attracted much of the world's interests in the huge oil and gas reserves of the Caspian Sea region. The newly independent countries have signed many contracts worth billions of dollars to develop the region's oil and gas fields. The Caspian Sea has the potential to become one of the major oil and gas production areas in the world similar in its capacity to the North Sea and the Gulf of Mexico (Energy Information Administration 2008).
During World War II, Azerbaijan's oil production peaked at about 500,000 barrels per day (bbl/d). Oil extracted from Azerbaijan constituted 71.4% of overall oil output of former Soviet Union. Following the war, the former Soviet Union directed resources elsewhere causing Azerbaijan's oil production to drop dramatically. In 1991, Azerbaijan gained its independence from the former Soviet Union and oil production was at a minimum low of 180,000 bbl/d (Energy Information Administration 2008).
The ability of Azerbaijan to develop its oil and natural gas resources was dependent on the availability of sources of capital and technology. Since then, Azerbaijan officials have been trying to attract foreign investments into their oil and gas industry. Azerbaijan's has 1.2 billion barrels of proven oil reserves in addition to enormous possible reserves in the Caspian Sea. These oil reserves in addition to successful governmental policies have attracted foreign international investment to Azerbaijan. Since 1996, over $3.4 billion has been invested in the oil sector with expectations to reach $2 billion in 2006. Ever since, Azerbaijan's oil industry experienced a boom reaching almost 800,000 bbl/d in 2007. Much growth is still anticipated during the 21st century. It is expected that by 2010, Azerbaijan's oil production would exceed 1.5 million bbl/d (www.stat.gov.az, 2006).
New fields in the Caspian Sea were developed through joint ventures (JVs) and production sharing agreements (PSAs). JVs were later converted to PSAs in 2000, due to their restrictions on the ability to export their oil (Energy Information Administration 2008).
The Caspian Sea has 30 billion tons of oil, 18-20 trillion cubic meters of gas, which comprises 15 percent of the world carbon-hydrogen resources. The oil deposit that belongs to Azerbaijan 3-5 billion tons of oil, 5 trillion cubic meters of gas the oil production in Azerbaijan is expected to increase rapidly (SOCAR, 2008)..
Azerbaijan carries most of its oil products from the Caspian Sea to the European market through the following four major pipelines: Baku-Tbilisi-Ceyhan (BTC), Baku-Novorossiysk, Baku-Supsa, and Caspian Pipeline Consortium (CPC) as shown in figure 1 (Energy Information Administration, 2008).

Figure 1: Four Major Pipelines of Azerbaijan
The Caspian Sea is also rich with natural gas. The largest natural gas field in Azerbaijan is Shah Deniz. Azerbaijan is planning to supply natural gas to Turkey and European countries through the development of South Caucasus Pipeline (SCP) (SOCAR, 2008).
The former Soviet Union lacked of environmental protection has caused heavy environmental damages to Azerbaijan and the Caspian Sea. Mismanagement of the oil industry has generated much pollution and alteration of the natural environment of Caspian Sea region. Furthermore, oil and ...Show more

Summary

The global demand for oil is rising at a much greater rate than existing energy resources are able to sustain. Today 85 million barrels of oil are produced each day. It is expected that the demand for oil would reach 115 million barrels a day by 2030 (Klare 2007).
Author : ovacollier
Oil Market in The Azerbaijan Republic essay example
Read Text Preview
Save Your Time for More Important Things
Let us write or edit the essay on your topic
"Oil Market in The Azerbaijan Republic"
with a personal 20% discount.
Grab the best paper

Related Essays

Oil Market
According to the paper operational dynamics in the market determines efficiency and cost and are therefore fundamental to stakeholders’ knowledge. This paper offers analysis to the market with focus on prices and market dynamics and offers expertise opinion over the market.
5 pages (1250 words) Essay
Comparing the Law of the Republic of Azerbaijan on Diplomatic Service and UK Diplomatic Service Regulations
Although it is impossible to create an expansive and nuanced comparison within a short four pages of text, the following analysis will attempt, with all due diligence, to encapsulate a discussion of the larger differentials that exists between the code of laws that govern the diplomatic service in both of these unique and distinct regions of the globe.
4 pages (1000 words) Essay
Finance
Some countries cooperate and jointly develop oil export capacity, while others focus on attracting enough investment to create their own routes. The oil and gas industry in the Azerbaijani is controlled by the major company State Oil Company of the Azerbaijan Republic (SOCAR).
5 pages (1250 words) Essay
Central Asia Post 1991 The Oil Roads
The Soviet Union broke up into its constituent units in December 1991, which became 'sovereign' members of the Commonwealth of Independent States (CIS). Five of these states, namely, Kazakhstan, Turkmenistan, Uzbekistan, Kyrgyzstan, and Tajikistan, constitute a major segment of the Central Asian region; other parts of it still remain with Russia or China.
25 pages (6250 words) Essay
Oil Taxes
This paper intends to look into the different taxes imposed on crude oil according to the new tax codes imposed as an effective contribution to the global economy. In this modern era, the industrial economy around the world has relied so much on oil as the lifeblood of every nation's major source of energy.
15 pages (3750 words) Essay
Oil Market
From cooking meals to generate electricity or to run automobiles, we cannot deny the fact that this product has something to do with man's life. In this regard, oil prices have been dictating the prices of major markets that are associated with the consumption of it and upon analyzing such a thing, the conclusion that when oil prices went up, the prices of some major commodities follows the movement.
4 pages (1000 words) Essay
The changing scenarios of the oil market in the Azerbaijan Republic
His devotion and support has made it possible for me to wind up my research successfully. I am grateful to the managers that I interviewed in Azerbaijan; especially Mr. Ali G. Jafarli, Deputy General Manager Foreign Investments Division, SOCAR,
18 pages (4500 words) Essay
Why, and with what effects, were there sharp increases in oil prices in 1973-74 and 1979-81
Historically speaking, high oil prices are nothing new and the oil production market is beset by erratic behaviour and wide fluctuations. Why, and with what effects, were there sharp increases in oil prices in 1973-74 and 1979-81? How have
10 pages (2500 words) Essay
Compare and contrast of azerbaijan's economic and political structure in 1969 with the present day. The role of Haydar Aliev
the first independent Republic of Azerbaijan, and, with this the important aspects that identify self-governing statehood started to be thoroughly abolished. In 1969, when Haydar Aliyev rose to power, the economic and political institutions of the republic started to change
18 pages (4500 words) Essay
Oil Market
Decreasing oil prices also assist in reducing operating expenses of the transport sector and other relatively large industries users of diesel, gasoline, and jet fuel. It is also evident that lower oil price instability
4 pages (1000 words) Essay
Get a custom paper written
by a pro under your requirements!
Win a special DISCOUNT!
Put in your e-mail and click the button with your lucky finger
Your email
YOUR PRIZE:
Apply my DISCOUNT
Comments (0)
Rate this paper:
Thank you! Your comment has been sent and will be posted after moderation