dramatic changes of oil and gas market
see the instruction file attached
The oil and gas market have experienced some dramatic changes in recent years. Some of the issues and consequences associated with high production are discussed in a video of an interview with Lynn Cook from The Wall Street Journal (see: http://www.pbs.org/newshour/bb/u-s-energy-firms-slash-jobs-crude-oil-prices-drop/#)
Based on information contained in the video and other information you might find, discuss the likely effects the recent fall in oil and gas prices are likely to have on the gasoline market. Specifically, based on your knowledge of supply and demand models: (a) discuss the effects falling oil and gas prices on the gasoline equilibrium quantity and price; and, (b) what price do you expect regular gasoline will be in Pullman WA on Feb 15, 2016 and on May 15, 2016 and explain why.
It may be useful to graph these scenarios and look for additional information before writing your answer. Please do not include your graph in your submission, but describe the results in your written analysis. Imagine you are preparing your analysis for a local news report where the audience is not likely to be familiar with supply and demand analysis (models).
Your report must not exceed one typed page with one-inch margins and 12-point font. Please include your name, instructor’s name (Dr. Casavant), course and section number 2 (i.e. EconS 101.02), and writing assignment (assignment 1) on the top of your assignment. Your essay will be assessed as either “Meets Expectations” or “Needs Improvement.” If your essay needs improvement, you will be given feedback from NetTutor to help you revise it. You can then re-submit the essay to NetTutor for another try, but you only get one second chance. If you take materials or quotes from sources, you must provide citations/references in a standard citation/reference format. Here are the criteria your essay will be judged against:
The writing is difficult to follow and/or poorly organized. Transition sentences are absent or ineffective. Typos and/or grammatical errors distract the reader. Source material citations/references needed, but are missing or incorrect.
Ideas are well-organized. Transition sentences effectively connect one idea to the next. The essay is free of typos and grammatical errors. Sources properly cited and referenced.
Application of economic analysis
Identification of the effects falling oil and gas prices on the gasoline equilibrium quantity and price are incorrect and/or unclear. The analysis of expectations about possible gasoline price change is incorrect and/or unclear with economic demand/supply theory.
Identification of likely price effects are correct and clearly indicated. Discussion and explanation of the expected change of gasoline price demonstrates coherent economic thought.