<html><head></head><body><div><span title="atymes@gmail.com">Adrian Tymes</span><span class="detail"> <atymes@gmail.com></span> , 9/2/2014 8:21 PM:<br><blockquote class="mori" style="margin:0 0 0 .8ex;border-left:2px blue solid;padding-left:1ex;"><div class="mcnt"><div>I don't see how you can justify the expected profit. The instant you start undercutting oil, oil prices shift to undercut you - and they can keep their prices down for years, if necessary, to wait until your operation runs out of money and shuts down, abandoning the hardware in place (no matter how efficient it would have been to keep using it).<br>
<br>That's how they've done it before; all indications are that they'd do it again.</div></div></blockquote></div><div><br></div><div>That would work if oil was only used for energy. But it is a key chemical product, and the non-energy uses are pretty big. So as soon as they started undercut prices, the chemical industry would be buying more of the cheaper oil - now the cartel would find itself subsidizing the chem industry. And since chem sales would increase the price, they would need to counter those too. Not cheap at all. And it all requires a cartel with no defectors.</div><div><br></div><div>Yes, there are some complications from the different kinds of oil. But you can see the same problem in regards to energy from fracking. </div><br><br>Anders Sandberg, Future of Humanity Institute Philosophy Faculty of Oxford University</body></html>