How the market prices of oils decided?

Answer 1

The world market of oil is divided between sellers and buyers. An integrated oil company or a national oil company may have both oil wells and refineries, thus it would seem likely that they would produce oil for their own use. But frequently, this is not the case, and their refinery may purchase oil from whom ever they chose and the owners of oil wells may sell their oil from whom ever they chose. A part of the capitalistic system is the right of sellers to try to get the highest price possible for their product and buyers to get the lowest price. Through negotiations a price is arrived at. Now, OPEC does have an impact on the free world dynamic pricing mechanism, but it appears much less than most people think. In recent months, they cut back production but oil prices have continued to fall.