Free Republic
Browse · Search
News/Activism
Topics · Post Article

To: RightWhale
It can't even match it. Process oil will always cost more than pumped oil while there is oil to pump. If somebody wants to pay a dollar a gallon more just to have process oil they probably also stop at Starbucks every day.

Unless pumped-oil folks can fill the entire world demand at a price that makes process oil unprofitable, your point, while correct, is not relevant. Higher cost production (including shale) will continue to increase (as long as the polar bears aren't more important than people) until the price is driven down to the risk rate of return on the marginally most costly production alternative. This is, of course, confounded somewhat by time lags. But the market will push in that direction.

22 posted on 07/23/2007 3:15:34 PM PDT by ModelBreaker
[ Post Reply | Private Reply | To 19 | View Replies ]


To: ModelBreaker
Higher cost production (including shale) will continue to increase . . . until the price is driven down

Not while there is cheap oil. Of course, gov't subsidy could equalize process oil and pumped oil, but until then nobody would choose shale over oil reserves if he had a choice. An oil company might do some pilot plant work just in case gov't subsidies come along later.

38 posted on 07/23/2007 4:06:27 PM PDT by RightWhale (It's Brecht's donkey, not mine)
[ Post Reply | Private Reply | To 22 | View Replies ]

Free Republic
Browse · Search
News/Activism
Topics · Post Article


FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson