Economy Blog » The Real Price that OPEC Wants: Geese vs. Black Swans

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The Real Price that OPEC Wants: Geese vs. Black Swans

Now that OPEC is playing nice with one another, at least temporarily, there is lots of discussion about the price OPEC wants for crude oil. Everyone says that OPEC likes higher prices, to a point, with the implicit argument being that there is some price at which OPEC members make lots of money, but it still dissuades investments in alternatives. That’s true, sort of. But it misses something important. Predictable prices, even at higher levels, are easier to invest around than unpredictable prices. If you know, in some sense, that crude oil prices are going to be over $100 for some time, you can plan accordingly as an investor, entrepreneur, integrated oilco, etc. …
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