Resource exhaustion has had little, if any, impact on oil costs and prices. Oil production costs have exhibited a falling long run trend, and the cost to produce oil in the Middle East is much lower than elsewhere. Having defended very high prices in the early 19805, the Middle East producers experienced a sharp reduction in their sales. To improve their ability to manage the oil market and control prices, the producers must expand their market share. This presupposes a period of prices that are even lower than in the late 19805. This the Middle East producers seem unwilling to accept.
Adelman, M. A.
"Oil Resource Wealth of the Middle East,"
Energy Studies Review:
1, Article 1.
Available at: http://digitalcommons.mcmaster.ca/esr/vol4/iss1/1