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Gold/Mining/Energy : Oil & Gas Price Economics
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To: Ed Ajootian who wrote (155)8/29/1999 9:33:00 PM
From: SDR-SI  Read Replies (1) of 350
 
Ed,

That might work for them, but if they were really looking to maximize their position and income over time, why wouldn't they do their best to let the small producers exhaust themselves early in the game, thereby putting the possessors of quantity into a position of almost total control at some future point. At that point the same-product competitive element would then no longer enter into the supply and demand equation and they could almost unilaterally determine their own price for the remaining years of their supply (assuming that non-petroleum energy sources cannot supplant the demand). It somewhat appears that they could just sit back and wait, and know that ultimately they will have the upper hand (which, of course, they do know).

JMHO

Steve

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