Originally posted by: MisterPicture
It will increase production because non-producing leases will be penalized.
It will not increase costs on active leases, because active leases will not be penalized.
It will reduce energy costs because incentivizing more production will increase the overall supply.
It all seems pretty obvious, doesn't it?
The financial risk of entry for a drilling project increases. The will decrease drilling
Originally posted by: Boilerman
This policy is for new leases only. Do you think that this policy will increase production or not?. Economics 101 tell us that an increase in the cost of doing business decreases business. All you guys must have flunked that class. At least that's what they teach at
Purdue's Krannert school of management
Boiler, unlike you, I actually took Econ 101...and 102...and 201...and 202...twelve university courses altogether. It was my minor.
So let me school you: an increase in costs doesn't necessarily lead to a decrease in business.
If the cost increase is related to cost of product, then those costs can be passed on to the customer. If sales volume remains the same, then there has been no net effect on business activity.
If the cost increase is related to fixed costs, a rational business entity will continue to operate as long as fixed costs are met. Sales would not be affected, though profit margins might.
If the cost increase is of marginal cost, then the business would logically move towards a business activity with lower marginal cost, while maintaining sales at the same level.
And guess what! This is what the oil companies are doing/will be forced to do. They'll have to move from higher costs (exploring and drilling) to lower costs (expanding production at existing wells). Sales will be as they were before.
You see, it's not as simplistic as you state it. As long as the producers of a product are also its primary sellers, they can manipulate prices to compensate for any increases in cost. And since demand for gasoline is largely inelastic--meaning that even large price movement doesn't change demand all that much--the oil companies are free to charge pretty much whatever they want. And they are!
Originally posted by: Kevin Lewis
Boiler, unlike you, I actually took Econ 101...and 102...and 201...and 202...twelve university courses altogether. It was my minor.
So let me school you: an increase in costs doesn't necessarily lead to a decrease in business.
If the cost increase is related to cost of product, then those costs can be passed on to the customer. If sales volume remains the same, then there has been no net effect on business activity.
If the cost increase is related to fixed costs, a rational business entity will continue to operate as long as fixed costs are met. Sales would not be affected, though profit margins might.
If the cost increase is of marginal cost, then the business would logically move towards a business activity with lower marginal cost, while maintaining sales at the same level.
And guess what! This is what the oil companies are doing/will be forced to do. They'll have to move from higher costs (exploring and drilling) to lower costs (expanding production at existing wells). Sales will be as they were before.
You see, it's not as simplistic as you state it. As long as the producers of a product are also its primary sellers, they can manipulate prices to compensate for any increases in cost. And since demand for gasoline is largely inelastic--meaning that even large price movement doesn't change demand all that much--the oil companies are free to charge pretty much whatever they want. And they are!
Kevin claims he took these Econ classes. He's either lying or he flunked. His argument is in conflict with everything that is taught.
Originally posted by: Boilerman
Kevin claims he took these Econ classes. He's either lying or he flunked. His argument is in conflict with everything that is taught.
How so? You can't say, can you?
I'm sorry that economic reality conflicts with your preconceived notions, but that's the way it is. You're an intellectual coward, and I'm not going to try any longer to argue against your beliefs about the noble fossil fuel companies. You should be ashamed of yourself, though.
My notions are not preconceived. It's Econ 101 and you don't understand it.
Originally posted by: Boilerman
My notions are not preconceived. It's Econ 101 and you don't understand it.
Did you ever take such a university course and pass it? Because so many of the concepts you've articulated in this thread and elsewhere are simply incorrect. And note that I'm not talking about politics. It's about basic economic concepts such as marginal cost and elasticity of demand--stuff that's absolutely essential to understanding the US energy markets but is waaaaaay over your head.
Your notions are indeed preconceived--you're a child of the fossil fuel industry and were trained long ago to be its rah-rah cheerleader. The proof of that is in the often absurd statements you've made in support of it. You think they can do no wrong. Most laughable is your contention that they'd LOVE to charge much, much less for gasoline but darn it all, they're helpless in the grip of the evil Biden administration.
Originally posted by: Kevin Lewis
Did you ever take such a university course and pass it? Because so many of the concepts you've articulated in this thread and elsewhere are simply incorrect. And note that I'm not talking about politics. It's about basic economic concepts such as marginal cost and elasticity of demand--stuff that's absolutely essential to understanding the US energy markets but is waaaaaay over your head.
Your notions are indeed preconceived--you're a child of the fossil fuel industry and were trained long ago to be its rah-rah cheerleader. The proof of that is in the often absurd statements you've made in support of it. You think they can do no wrong. Most laughable is your contention that they'd LOVE to charge much, much less for gasoline but darn it all, they're helpless in the grip of the evil Biden administration.
Every oil man in America will tell you that Bidens policies and Biden's comments on future policies have limited oil explocation
But Kevin knows better.
Originally posted by: Boilerman
Every oil man in America will tell you that Bidens policies and Biden's comments on future policies have limited oil explocation
But Kevin knows better.
But O Fossil Fuel Expert, you've told us repeatedly that drilling sites take years to develop! So what the fuck do present drilling permits have to do with the current price of gas? Answer: nothing.
You shame yourself when you twist yourself into logical knots to try to be a fossil fuel company cheerleader. They've managed to convince a LOT of stupid people that Biden is somehow forcing them to charge astronomical prices for their shit. And you, O Fossil Fuel Expert, have happily climbed aboard that bandwagon.
The price of gas is determined by the companies that sell it. That's Econ 001. Duhhh.
Originally posted by: Kevin Lewis
But O Fossil Fuel Expert, you've told us repeatedly that drilling sites take years to develop! So what the fuck do present drilling permits have to do with the current price of gas? Answer: nothing.
You shame yourself when you twist yourself into logical knots to try to be a fossil fuel company cheerleader. They've managed to convince a LOT of stupid people that Biden is somehow forcing them to charge astronomical prices for their shit. And you, O Fossil Fuel Expert, have happily climbed aboard that bandwagon.
The price of gas is determined by the companies that sell it. That's Econ 001. Duhhh.
Cutting to the chase --- any moron can see the reality --- I expect PJ and Lewis to argue what is narrated in this video ---https://fb.watch/cgJqBGWL5x/
There is very little valid information in Facebook videos, and none at all in the shit David posts. He has nothing to contribute--just like his life in general.
