Friday, August 23, 2013

several fracking stories

1.  Obama vs. NY on fracking. 

It's a rare time I agree with Obama on public policy!

There is debate over the what might happen to the price of natural gas in the near future.  Some are predicting big price increases.  I tend to think the supply is so abundant that the price won't rise much - even if new pipelines increase demand dramatically.  Cases like China, South Africa, and New York which might start increasing their production dramatically are part of why I have this opinion.  

In econ-speak - the supply of natural gas should be very elastic.  As price rises a little, the supply should increase dramatically.  As long as that happens, we shouldn't expect a big price increase.  


No comments:

Post a Comment