Oil prices plummeted from over $100 per barrel in mid-2014 to under $30 in early 2016. According
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Oil prices plummeted from over $100 per barrel in mid-2014 to under $30 in early 2016. According to a Reuters article, oil traders in 2015 and 2016 put massive amounts of oil in storage (even on tankers at sea), anticipating higher prices in the future. The article noted that in early 2017, “traders are turning the spigots to drain the priciest storage tanks holding U.S. crude stockpiles as strengthening markets make it unprofitable to store for future sale.” What effect would the strategy of stockpiling crude oil have had for the supply of oil in 2015 and 2016? Use a graph to illustrate your answer.
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One of the variables that will shift a market supply curve is a change ...View the full answer
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