I came across this article while doing a search. Where do you think it fits in the supply and demand theory?

Question

http://www.economist.com/opinion/displaystory.cfm?story_id=7276986

Answer 1

Interesting article... but every time someone says privatize I step back... privatization would give the impression of the industrious business man, when in fact if that oil suddenly became available to private companies, the very same mega conglomerates that now dominate almost every facet of world trade would step in and grab it up... and I think it would be nearly impossible to regulate because of the amounts of liquid gold that we're talking about.. It's not a good situation, but unless you are suggesting organizing by region , publicly held..and I mean public not share holders but actual citizenry, than it would only be the same scenario that we have now with privatized, health care, insurance, Agriculture... it wouldn't improve anything in the long run for Joe and Jenny public, no more corporatism...

Answer 2

Having reserves is not the same as having the ability to pump, store, transport, store, transport, store, refine, store and transport. The NOC's are located in countries with poor infrastructure, political unrest, political corruption and antiquated systems. In order to efficiently go from ground to consumer entire systems must first be put into place, These systems are expensive and can hardly be done overnight.

Through out the nineties, the price of oil hoovered around $15 per barrel. At this price, investment into building these systems was not an option.

It fits into supply and demand in that the higher the price the more investment into systems which increases supply lowering the price. We also know that high prices creates investment into technology to decrease usage or find less costly substitutes.

Answer 3

It is a more complicated version of supply as it is a false supply or more of a controlled supply that is happening. If you are looking for an article that illustrates supply and demand, I wouldn't chose this one unless you are ready to explain how the company is controlling the supply for various reasons to increase the demand. It would be a much more complicated explanation than say the oranges after the California freeze.

Answer 4

If these companies where privatized production would go up, the countries would make more $ and oil prices would fall a bit, but even oil prices could be controlled better. Anytime the govt is controls production of a product or service, the delivery becomes terribly inefficient. Iraq is a good example, the Socialist US government encouraged them to nationalize their oil production and as a result that is failing; oil production equipment is in disrepair and the overall operation is weak and ineffective. Had the US ecouraged privatizing oil, their output would have been higher and terrorism would be lower because many more jobs in oil would be available. But the US government behemoth likes to shoot them and our country in the foot.

Answer 5

Privatization of nationalized oil companies would just shift profits and control from one interest to another, none of those interests giving a fig about what's best for folks in general. So you can theorize all you want, doesn't matter to us unwashed masses, we still pay through the nose for gas and plastic bags and asphalt roads, so that a corporation or a king can get richer. It's probably fairer to have it go to someone from where the oil actually is there, under their land, however.

Answer 6

It fits best in description of monopoly, where supply is fixed.

Answer 7

BUSH MADE ME CONSTIPATED

http://www.funduc.com/images/srshot.gif

Answer 8

What can we do as Republicans to prove we is smort?