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Without OPEC collusion (which has broken down) the oil producers are price takers, not price makers. The Nash equilibrium is everybody low or everybody high.
by SixSigma 11y ago
Without OPEC collusion (which has broken down) the oil producers are price takers, not price makers.
The Nash equilibrium is everybody low or everybody high.
It is a Stag Hunt, and everyone is taking home Hares.
https://en.wikipedia.org/wiki/Stag_hunt https://en.wikipedia.org/wiki/Stag_hunt
- mcguire 11y agoSaudi oil production is higher than it has been since the late '70s. Which means to me that they're driving supply well above any kind of stable point. Certainly, they're taking an economic hit from it. Which they have done before to drive other suppliers into line. The Saudis are not so much chasing hares as cockroaches. http://www.tradingeconomics.com/saudi-arabia/crude-oil-production http://www.tradingeconomics.com/saudi-arabia/crude-oil-produ...