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View Diary: Peak oil and peak silliness (111 comments)

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  •  Increasing Marginal Costs For Us, Profit For Them (1+ / 0-)
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    peregrine kate

    There’s always free cheddar in a mousetrap, baby

    by bernardpliers on Fri Apr 05, 2013 at 08:05:55 PM PDT

    [ Parent ]

    •  So, competition, rather than lowering the price (0+ / 0-)

      will cause reduced production? That's not how they tell us The Free Market is supposed to operate.

      Because of the high production costs associated with fracturing shale formations to squeeze out a few barrels of oil, the industry is only going to produce when oil prices are high enough to guarantee a decent profit margin.

      -- We are just regular people informed on issues

      by mike101 on Fri Apr 05, 2013 at 08:34:12 PM PDT

      [ Parent ]

      •  Little "Demand Elasticity" Or Substitutes (1+ / 0-)
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        Bronx59

        We mostly get stuck paying whatever price they want.

        There’s always free cheddar in a mousetrap, baby

        by bernardpliers on Fri Apr 05, 2013 at 08:45:42 PM PDT

        [ Parent ]

        •  In the short term, true (1+ / 0-)
          Recommended by:
          bernardpliers

          Demand for gasoline and diesel in the U.S. is essentially inelastic.  Doubling the price of gasoline would reduce demand by 20% or less.

          In the longer term, people would change jobs, move, buy more efficient cars, etc., reducing demand substantially.  All of those things are hard to do quickly.  

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