Question

"The world will run out of oil in 2030, and other fossil fuels in 2050." In the 1950s, a geologist named M. King Hubbert looked at oil production data from all of the major oil-producing countries in the world (at that time). Focus on the difference between the supply and quantity supplied and demand and the quantity demanded.

Answer 1

Supply is driven by non-price determinants, where as quantity supplied, changes with price. So, depletion of resources, interruption of production and or war like scenario affect the supply of oil. At the same time, increase in price will increase the quantity supplied and vice versa.

In contrast to it, demand is affected by non-price factors such as increase in income, industrial activities and changing trends and preferences among the others. So, with change in these factors, can increase the demand of oil, leading to the depletion of the resources. Though, quantity demanded is driven price only. A higher price leads to decrease in quantity demanded and vice versa.