The paper provides a theoretical framework to explain the determination of international oil prices based upon the interaction of supply and demand curves. The analysis of components of the framework identifies important characteristics of the global market for crude oil, The paper applies the framework to the oil market from 1945. In particular, it incorporates key changes in the market to enhance understanding of how the market has been and is working, Finally, the framework is used to explain why oil prices have become more volatile and what issues and questions arise from current oil market behaviour.