&quot;&quot;&quot;In a normal competitive market, prices will be set by the cost of producing an extra barrel from the cheapest oilfields with spare capacity.&quot;&quot;&quot;<p>This seems wrong as the marginal price is determined by the utility of an extra barrel of oil for the consumer not by production cost. Sounds like a fall back to the labor theory of value (aka classical economics and&#x2F;or Marxism) to me.