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56 comments on Has OECD oil consumption peaked?

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Rune Likvern on April 14, 2009 - 2:35pm Permalink | Subthread | Parent | Comments top

This is interesting.

Would you care to elaborate a little more about this?

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Pitt the Elder on April 14, 2009 - 8:58pm Permalink | Subthread | Parent | Comments top

The theory appears to be that people in the OECD burn a lot more oil for luxury and discretionary uses (large cars, pleasure trips, long commutes, convenient vs. efficient shopping trips, etc.) than do people in developing countries, and that luxury/discretionary spending is more sensitive to price than business/necessity-related spending. Based on that, we should not be surprised to see higher price elasticity in the OECD than in developing countries.

Essentially, "rich vs. poor" is being outweighed by "luxury vs. necessity". It's apparently been more worth paying a higher oil price for a Chinese factory to move its products to market than for a Jersey soccer mom to leave the engine running for AC while she waits for her kids.

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56 comments on Has OECD oil consumption peaked?

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