"Citigroup is telling us that oil is going to head down to $20 a barrel soon enough. Further, that Opec’s hold over the oil price is now definitively broken. That’s a pair of pretty strong claims and of course we need to take them both with the appropriate amount of salt. But I think the first is possible and the second is likely. Even though I agree that that second, the days of Opec’s control being over, is the more remarkable claim I do think it is the stronger of the two. The reason for this is two little bits of economics. The first being that monopolies and cartels do indeed exist but in the end they always fall over. If it’s not because of legal action against them, or because of cheating among the cartel’s members, then in the end technological advance will indeed get them. And that change here is fracking for tight oil. No, it’s not that the fracking revolution is cheaper than Saudi conventional oil or anything like that. But because the technology of fracking entirely changes the elasticity of supply of oil and that really does change the whole marketplace."This will happen at some point because the technology of oil production, not just fracking, is advancing, but Citi will probably be gone before this happens.
The middle class is shrinking.
Apple first $700 billion company.
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