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Oil has much greater economic value when used as a feedstock for non-fuel purposes. It is almost certainly a better idea to let any reserves you possibly can st
by Baeocystin 8y ago
Oil has much greater economic value when used as a feedstock for non-fuel purposes. It is almost certainly a better idea to let any reserves you possibly can stay in the ground for as long as possible, and let everyone else sell theirs for cheap first.
- refurb 8y agoBut if 90% of the demand for oil (transportation) disappears and supply stays the same, the price is going to drop big time.
- Baeocystin 8y agoIf demand dropped, initially supply would drop offline as prices could no longer support the more difficult wells rather quickly. And as actual production falls, the amount charged that the market could bear (if the market was mostly the non-fuel, high-value uses) could be significantly higher than what we see today. A scary time to be an investor in an oil company, absolutely. But taken in the broad view, leaving oil for later will almost certainly enhance total future potential profits, if not the rate of profit per unit time.