Excess supply

In cultural evolution, agricultural surplus in the Neolithic period is theorized to have produced a greater division of labor, resulting in social stratification and class.

A disequilibrium occurs due to a non-equilibrium price giving a lack of balance between supply and demand.

For example, when there is excess supply in the labor market—that is, unemployment—consumer-laborers will be constrained in their disposable income and hence will demand a smaller quantity of goods at any given price.

The main case is probably that suppliers cannot perfectly predict the market (unpredictable events, which leads to changes of supply or demand).

Furthermore, the higher prices will have a negative effect on consumers, while producers will be left with excess inventories until the market corrects itself entirely.

However, this gives rise to another problem, and that is the fact that the government has to spend a part of its budget that could have been used for any other purpose that could have given more benefits to the economy.

Firstly, the limited mobility of people across borders, due to pandemic measures, contributed to labour shortages; especially in the agricultural sector.

After failing to reach an agreement the OPEC+ alliance was disbanded, and shortly after Russia increased its production of oil, Saudi Arabia followed and a price war emerged.

This combined with the lower demand for oil, caused by the pandemic, led to excess supply with prices even going negative on the 20th of April.

Even after Russia and Saudi Arabia reached an agreement to cut oil production, excess supply was still present.

On the other hand (if we talk about demand) encouraging customers to buy things, for example, sales are a great instrument that allows sellers to reduce inventory as well as other marketing techniques such as 2+1, black Fridays and night shopping.

Generally, if we look at theorems in paragraph causes and we improve them or reverse them it helps to avoid excess supply, so financial and economic stability contributes to stable demand so as inflation (money yesterday have less value so it's better to spend them today).