The Economics of Excessive Excess Supply: Declining Oil and Steel Prices

Abstract

When does the oversupply of goods, products, or commodities become an intended or deliberate act – rather than the result of uncontrollable economic, geopolitical forces? Should international agreements govern or control market forces or intended acts? Why should major oil or steel producers flood the markets with their products if a direct consequence of such act, namely a decline in prices, could adversely affect their economies – and more importantly, generate adverse spill-over effects? What could be the driving force behind a nation’s decision – in so doing, to act against its national and economic interests? Are there other reasons or powerful unions behind such acts? These are amongst some of the questions, which constitute some of the objectives that this paper aims to address

Keywords: environment, oil prices, steel prices, Port Talbot, supply, demand, financial markets, volatility, European Union