Re: Opec, Russia heading for cold war

"Ian St. John" <[EMAIL PROTECTED]> wrote in message news:<[EMAIL PROTECTED]>...
> "Tim Worstall" <[EMAIL PROTECTED]> wrote in message
> news:[EMAIL PROTECTED]
> > "Ian St. John" <[EMAIL PROTECTED]> wrote in message
>  news:<[EMAIL PROTECTED]>...
> > > "Dr. Convection" <[EMAIL PROTECTED]> wrote in message
> > > news:[EMAIL PROTECTED]
> > > > From:
> > > >
> > >
>  http://english.aljazeera.net/NR/exeres/C9A06782-162E-4CE8-918A-4645440070B6.
> > > > htm
> > > >
> > > > Aljazeera.Net
> > > > Opec, Russia heading for cold war
> > >
> > > OPEC cannot have a war, hot or cold. It can only set it's own prices.
>  That
> > > is what cartels do.
> >
> > Not quite. They " attempt " to set prices.
> 
> Well, they could set prices but what they actually do is set their output
> volume to cause the markets to adjust the price.
> 
> > And they influence prices,
> > but only monopolies can " set " prices, and then only in the short
> > term until technological substitution gets around the monoply.
> 
> They have a monopoly on their own oil.  As the current world cannot do
> without it using alternative sources or methods, they effectively have a
> monopoly power.
> 

No. As always, one must be precise. OPEC is both a cartel and the
provider of a large portion of internationally traded oil. But it is
not a monopoly. You can run the proof either way : They do not set the
price of oil, only influence it, so therefore they are not a monopoly.
Or, there are alternative suppliers of oil, so OPEC is not a monopoly,
and thus can only influence, rather than set, the price of oil.
You will no doubt dismiss this as trivial nitpicking but there is an
important point. Not just that one needs to be precise in one's use of
technical terminology. If OPEC truly is a monopoly supplier of our
energy needs then we would be justified in taking legal action against
it : as we do with domestic monopolies. And as there is no
international legal system to back up such actions : we would be left
with only the threat of force to break up such a monopoly. Now I know
that you think that's what Shrub has been doing in Iraq, but I didn't
think it would be you who would justify it.

Tim Worstall
> >
> > Tim Worstall
> >
> >  What a loon.