If the oil market is reasonably efficient, then the price of a barrel of oil should reflect something like the cost of production of the highest-cost barrel of oil needed to just satisfy demand. In other words, the market price of oil should reflect the marginal cost of production. The price of oil on the world …
How Can the Market Price of Oil Fall So Far So Fast? Read More »
A careful comparison of Saudi Arabia’s oil production behavior with rest-of-OPEC production provides a way to see the consistency in Saudi behavior where many analysts have missed it, according to the authors of a report forthcoming in the journal Energy Policy. Sometimes Saudi and rest-of-OPEC production movements are positively correlated and other times negatively correlated–a …
Michael Giberson News about the Chinese economy has become a bit worrisome, for instance from the New York Times earlier this week, “China Confronts Mounting Piles of Unsold Goods“: After three decades of torrid growth, China is encountering an unfamiliar problem with its newly struggling economy: a huge buildup of unsold goods that is cluttering …
Michael Giberson James Hamilton, “Will rising oil prices derail the recovery?“: I have no doubt that the problems with financial markets were a bigger factor than oil prices in the striking collapse in output in 2008:Q4 and 2009:Q1. The other approaches to measuring the contribution of oil to the downturn surveyed in my Brookings paper …
Michael Giberson The list of people who agreed, after the fact, that yes there was a {internet company | real estate | … | tulip bulb} price bubble is frequently longer than the list of people who publicly announce a bubble in unequivocal terms in advance of a crash. But here you have someone willing …
Calling the Next Bubble: is There Currently a “Dollar-Led Asset Bubble”? Read More »
Michael Giberson Geoff Styles: Speculation Witch Hunt? He says he thinks “the CFTC and its supporters in Congress and the administration are barking up the wrong tree, altogether, based on a fundamental misunderstanding of the markets.” the current determination to clamp down on speculation appears to be based on two hypotheses that are … probably …
Geoff Styles on the CFTC’s Desire to Fix Up Energy Futures Markets Read More »
Michael Giberson I don’t know about the rest of you university energy economists, but life in the classroom got a little tougher for me this Spring. Last Fall energy economics was on the front pages of the nation’s newspapers every week, nearly every day. Anytime I wandered into class a minute or two early, I …
Oil Shocker: Energy Economist Bids to Get Back on the Front Page Read More »
Michael Giberson So low, and yet so high. It seems to be the way consumers feel about gasoline prices these days. Yes, prices are down compared to a year ago, but everyone knows that crude oil prices have been going down lately while gasoline prices are up from their December 2008 lows. From The Mercury …
Why Are Gasoline Prices So High? (February 2009 Version). Read More »
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