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# Despite the approach of winter, oil prices to industrial

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Despite the approach of winter, oil prices to industrial [#permalink]  20 Aug 2008, 10:03
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Despite the approach of winter, oil prices to industrial customers are exceptionally low this year and likely to remain so. Therefore, unless the winter is especially severe, the price of natural gas to industrial customers is also likely to remain low.

Which of the following, if true, provides the most support for the conclusion above?
(A) Long-term weather forecasts predict a mild winter.
(B) The industrial users who consume most natural gas can quickly and cheaply switch to using oil instead.
(C) The largest sources of supply for both oil and natural gas are in subtropical regions unlikely to be affected by winter weather.
(D) The fuel requirements of industrial users of natural gas are not seriously affected by the weather.
(E) Oil distribution is more likely to be affected by severe winter weather than is the distribution of natural gas.
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Re: CR winter [#permalink]  20 Aug 2008, 11:51

lordw wrote:
Despite the approach of winter, oil prices to industrial customers are exceptionally low this year and likely to remain so. Therefore, unless the winter is especially severe, the price of natural gas to industrial customers is also likely to remain low.

Which of the following, if true, provides the most support for the conclusion above?
(A) Long-term weather forecasts predict a mild winter. This doesn't support the conclusion. This is irrelevant.
(B) The industrial users who consume most natural gas can quickly and cheaply switch to using oil instead. This supports the stem by showing that if the price of natural gas goes up, users of natural gas can easily change to oil because of the price.
(C) The largest sources of supply for both oil and natural gas are in subtropical regions unlikely to be affected by winter weather. This has nothing to do with the demand for oil/natural gas by users.
(D) The fuel requirements of industrial users of natural gas are not seriously affected by the weather. This actually weakens the conclusion in the stem.
(E) Oil distribution is more likely to be affected by severe winter weather than is the distribution of natural gas. This is out of scope. The stem doesn't discuss "oil distribution".

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Manager
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Schools: Darden School of Business (Class of 2012)
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Re: CR winter [#permalink]  20 Aug 2008, 12:02
Tks.
One more doubt si vous plait
how con you connect low prices of gas remain low with changing to oil prices?

jallenmorris wrote:

lordw wrote:
Despite the approach of winter, oil prices to industrial customers are exceptionally low this year and likely to remain so. Therefore, unless the winter is especially severe, the price of natural gas to industrial customers is also likely to remain low.

Which of the following, if true, provides the most support for the conclusion above?
(A) Long-term weather forecasts predict a mild winter. This doesn't support the conclusion. This is irrelevant.
(B) The industrial users who consume most natural gas can quickly and cheaply switch to using oil instead. This supports the stem by showing that if the price of natural gas goes up, users of natural gas can easily change to oil because of the price.
(C) The largest sources of supply for both oil and natural gas are in subtropical regions unlikely to be affected by winter weather. This has nothing to do with the demand for oil/natural gas by users.
(D) The fuel requirements of industrial users of natural gas are not seriously affected by the weather. This actually weakens the conclusion in the stem.
(E) Oil distribution is more likely to be affected by severe winter weather than is the distribution of natural gas. This is out of scope. The stem doesn't discuss "oil distribution".

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Re: CR winter [#permalink]  20 Aug 2008, 12:11
lordw wrote:
Despite the approach of winter, oil prices to industrial customers are exceptionally low this year and likely to remain so. Therefore, unless the winter is especially severe, the price of natural gas to industrial customers is also likely to remain low.

Which of the following, if true, provides the most support for the conclusion above?
(A) Long-term weather forecasts predict a mild winter.
(B) The industrial users who consume most natural gas can quickly and cheaply switch to using oil instead.
(C) The largest sources of supply for both oil and natural gas are in subtropical regions unlikely to be affected by winter weather.
(D) The fuel requirements of industrial users of natural gas are not seriously affected by the weather.
(E) Oil distribution is more likely to be affected by severe winter weather than is the distribution of natural gas.

B. If they cannot switch instanteneously, then the price balance cannot be maintain. When Gas users switch to cheap oil, then the gas price has to come down as a result of decreased demand.

This is how the price balance is maintained.
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Re: CR winter [#permalink]  21 Aug 2008, 10:11
(A) eliminate

(B) correct. vise versa, if industries are using oil, and have to switch to gas because of the rising prices, the greater demand for gas would take the prices of gas higher.

(C) supply! eliminate

(D) supports the argument and not the conclusion

(E) distribution! eliminate
Re: CR winter   [#permalink] 21 Aug 2008, 10:11
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