Describe how the fluctuation of crude oil affects the various aspects of the exchange process (the market, the agents involved, the equilibrium outcome)

Oil has been one of the largest contributors to the global economy. Both demands for crude oil and supply have a significant impact on prices; this is a major concern for global investors and those countries that are involved in the export and import of crude oil. When there are fluctuations in crude oil, there is a challenge for countries that are either rich or deficient in crude oil. Fluctuations also affect oil demand and supply. It causes the economies of the countries that export and import it (agents) to suffer a loss of revenue and therefore a severe budget loss. This leads to a trade imbalance in these countries. These countries are therefore forced to think about other strategies for generating revenue or even try to cut public spending. They also cut subsidies, as well as carry out fiscal consolidation.

In the event of fluctuations in crude oil, there are changes in demand and supply of petroleum and diesel; crude oil products. When there is no change in demand and supply, the balance remains unchanged. However, if there is any change in either of them, the balance changes. When the price of oil falls, the quantity requested increases and the quantity supplied decreases. This also affects the outcome of the balance. It is until there is no surplus that the balance will be achieved.