viking on Nostr: Adam Curry was confusing the price Saudi Arabia wants with a price floor on oil. The ...
Adam Curry was confusing the price Saudi Arabia wants with a price floor on oil.
The price floor on oil is determined by the price where a sufficiently high fraction of the oil producers stop pumping up the oil, because the oil price doesn't cover the variable cost of production.
Another higher number is the oil price required to finance new production, what is the price that allows you to get financing at today's interest rate, and expect a profit for developing a new oil field.
The price floor on oil is determined by the price where a sufficiently high fraction of the oil producers stop pumping up the oil, because the oil price doesn't cover the variable cost of production.
Another higher number is the oil price required to finance new production, what is the price that allows you to get financing at today's interest rate, and expect a profit for developing a new oil field.