I said earlier [2015] year that I thought we'd get to 10…
![“I said earlier [2015] year that I thought we'd get to 10 or 20 bucks [per barrel ] because that's the marginal cost, and when you're in a price war, it's the marginal cost that determines the price.It is a price war because basically the OPEC reason did not cut production in their November 2014…” quote by Gary Shilling](https://sms4smile.com/q/img-quotes/66c/gary-shilling-27568_barrels_i-said-earlier-2015-year-that-i-thought_2695177.jpg)
“I said earlier [2015] year that I thought we'd get to 10 or 20 bucks [per barrel ] because that's the marginal cost, and when you're in a price war, it's the marginal cost that determines the price.It is a price war because basically the OPEC reason did not cut production in their November 2014 meeting was that they got tired of cutting production and having American frackers and Russians et cetera grab market share.”
About This Quote
This interpretation was drafted with AI assistance. It is one reading of the quote, not the author's own explanation.
Marginal cost drives prices in competitive markets; OPEC’s production cuts aim to avoid price wars but can backfire.
In simple terms: Cost determines price in wars; OPEC cuts to keep market share.
Key Takeaway
Watch marginal cost when analyzing price wars.
Themes
energy markets
price wars
OPEC
production
Mood
analytical
concerned
Type
economic
strategic
When to use this quote
- oil pricing
- energy policy
- investment decisions
- risk assessment
Key Concepts
economics
market dynamics
strategic behavior
Questions to Reflect On
- How does marginal cost influence your pricing strategy?
- What are the risks of OPEC production cuts?
A Different Perspective
Assumes all players act rationally; geopolitical factors may dominate.