I will be honest: a few months ago, when the West (European Union, United States, Canada, Australia, & Japan) announced a price cap on Russian oil… I didn’t think it would work. I didn’t have any good rationale for this skepticism, other than the fact that it was a gut feeling. Intuition. As an economics student, it’s drilled into you that price ceilings are BAD and INEFFICIENT.
Honestly. I’m confused why we are picking sides with Ukraine? I see the value of a buffer against bad Russia - but otherwise, Ukraine is not NATO or a country that morally we should be standing up for.
So we are pumping money into the Ukraine pit (we both know 80%+ is going into the pockets of slime balls) and keep saying Russia bad - yet we don’t have a real reason to even have a dog in this fight?
Remind me again which country is the most corrupt in Europe (maybe the world), leads in trafficking, supports Nazis, proven to launder $$ for US elites?
I’m no Russian fan - but isn’t this a little obvious folks?
Early days yet, as you say. These kinds of interventions tend to produce the desired effect in the short run, but become increasingly destructive as time goes on.
Carne back to check on the poll. Number of respondents has about doubled but results are pretty stable: 3/4 expect Russia to win, but sympathies are divided about 50/50. That's an interesting result, considering that this isn't really a war between Russia and Ukraine, but a war between Russia and the West.
So, most people expect the West to lose, and half of us WANT the West to lose. Considering that the readership is likely to be overwhelming Western, both are a rather dark comment on the state of Western morale.
Unintended consequences are guaranteed when governments meddle in markets.
On another note, even if you can only sell oil below the cost of production producers nearly always continue to produce at some level. Most wells cannot be turned off and on. Shutting a well down may require a lot of cost to turn it back on.
The analysis that oil price will rise due to price cap (without mentioning a proper view on supply and demand considering China, SPR, production constraints due to low reinvestment, etc) is completely ridiculous, as the cap impacts the flows and not really the production level.
Honestly. I’m confused why we are picking sides with Ukraine? I see the value of a buffer against bad Russia - but otherwise, Ukraine is not NATO or a country that morally we should be standing up for.
So we are pumping money into the Ukraine pit (we both know 80%+ is going into the pockets of slime balls) and keep saying Russia bad - yet we don’t have a real reason to even have a dog in this fight?
Remind me again which country is the most corrupt in Europe (maybe the world), leads in trafficking, supports Nazis, proven to launder $$ for US elites?
I’m no Russian fan - but isn’t this a little obvious folks?
Early days yet, as you say. These kinds of interventions tend to produce the desired effect in the short run, but become increasingly destructive as time goes on.
Carne back to check on the poll. Number of respondents has about doubled but results are pretty stable: 3/4 expect Russia to win, but sympathies are divided about 50/50. That's an interesting result, considering that this isn't really a war between Russia and Ukraine, but a war between Russia and the West.
So, most people expect the West to lose, and half of us WANT the West to lose. Considering that the readership is likely to be overwhelming Western, both are a rather dark comment on the state of Western morale.
Unintended consequences are guaranteed when governments meddle in markets.
On another note, even if you can only sell oil below the cost of production producers nearly always continue to produce at some level. Most wells cannot be turned off and on. Shutting a well down may require a lot of cost to turn it back on.
The analysis that oil price will rise due to price cap (without mentioning a proper view on supply and demand considering China, SPR, production constraints due to low reinvestment, etc) is completely ridiculous, as the cap impacts the flows and not really the production level.
Time to go back to oil economics 101…