Relax guys, the Myian Callender only wentto 2012.

 

I'm trying to take comfort in the fact that historically, the economy is crappy in an election year... Hope we can get outta this slump.

 

Actually, the price elasticity of demand shows why supply and demand is not bs. You are correct in that the demand for crude has shown to be highly inelastic.When you plot ademand curve on a graph a perfectly elastic demand would be a verticle line, meaning that for a certainchange in price the quantity demanded changes nada.A perfectly elastic demand is a horizontal line, meaning that a miniscule change in price is accompanied by a change in quantity demanded that goes to infinity. The demand for oil is not perfectly elastic of course, but it is pretty steep.

It makes sense that the demand for oil is quite inelastic, since it is a product that has no good substitute for most applications. In my own life I have reduced my consumption slightly in the last few months, but basically I am driving about the same amount even as the price has increased70% in the last year.

 

Adding credence to al5608's initial post, here is an article linked on Drudge that talks about reasons for oil prices to subside in the near future: http://www.telegraph.co.uk/money/mai...2/ccoil122.xml

 

Joel_MD I thought it was going to stop at $100. Here is the best analysis that I read up to date. Even if it goes to $70 we'll still be paying over $3.50. Earliest relief will be after the China Olympics.[sm=icon_cheers.gif]

http://www.321energy.com/editorials/maund/maund051408.html