Post #2747961

[This video](https://www.youtube.com/watch?v=5qjvluMnyAw) helped me understand it a bit more. Basically the condition is that there's not an immediate replacement for oil in the things that use it and that usage of oil is not going to drop by 20% to cover the reduction in the supply. Since oil is an inelastic product and we can't significantly reduce the consumption in response to higher prices in the short term, this causes a more steep increase in price to balance the supply/demand.