Deja vu all over again: another oil price fiasco

摘要

It appears to us that the current oil market situation has a familiar and disheartening ring. In September 1986, we presented an analysis to the Oxford Energy Seminar in which we estimated the high cost of a decision taken by OPEC to pursue market share rather than defend a target price. This analysis later appeared in a book, The Oil Price Crisis, edited by Robert Mabro. (Quotations in this article are taken from this book.) In November 2014, OPEC oil ministers again faced a similar choice: defend the oil price, which had been declining since June, or defend the OPEC market share, which had been threatened by soaring non-OPEC oil production for several years. No one believed the ministers could do both simultaneously.