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Despite the approach of winter, oil prices to industrial

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Senior Manager
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Despite the approach of winter, oil prices to industrial [#permalink]

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28 Jul 2006, 21:42
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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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Senior Manager
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Location: Rancho Palos Verdes
Re: CR --- Oil prices [#permalink]

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28 Jul 2006, 21:57
B is my pick!

"When the question stem says â€œFind a conclusion that is best supported by the passage aboveâ€
_________________

The only thing that matters is what you believe.

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Director
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Re: CR --- Oil prices [#permalink]

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28 Jul 2006, 22:58
mailtheguru 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.

I am taking B.

We need to find out how natural gas is connected with oil and how they impact each other.
If price of Natural Gas increases then consumers can easily switch to Oil which they can avail in low price.

Regards,
Brajesh

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VP
Joined: 14 May 2006
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29 Jul 2006, 08:32
I am going to take D here... here is why:

Premise: Winter -> price of oil low now, likely to remain so
....missing premise, must be something about nat. gas....
Conclusion: Price of natural gas -> to stay low, UNLESS "real" winter strikes.

Which of the following, if true, provides the most support for the conclusion above?
What type of question is this?... no... not conclusion... this is strengthen question... we need to find a support for conclusion that price of natural gas will stay low. Now... since there is no premise (info) about natural gas, the answer should say something about it to draw such conclusion.

(A) OUT OF SCOPE... no indication of that... in fact, the argument is uncertain about the weather.

(B) OUT OF SCOPE... do we care about the fact that they can switch from 1 to 2? how does it support the conclusion that price on natural gas will stay low? THIS ONE IS A TRAP!!!

(C) OUT OF SCOPE... we don't know anything about where the oil/gas comes from

(D) The fuel requirements of industrial users of natural gas are not seriously affected by the weather.
By POE this is the one; Let's negate this one and see what happens:

The fuel requirements of users of nat. gas ARE seriously affected by the weather. Thus, the prices of gas WILL NOT stay lower... AHA -> conclusion FALLS APART... so this is correct choice

(E) Opposite is true... in fact, both oil and gas seem to be affected together

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VP
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29 Jul 2006, 09:06
u2lover wrote:
I am going to take D here... here is why:

Premise: Winter -> price of oil low now, likely to remain so
....missing premise, must be something about nat. gas....
Conclusion: Price of natural gas -> to stay low, UNLESS "real" winter strikes.

Which of the following, if true, provides the most support for the conclusion above?
What type of question is this?... no... not conclusion... this is strengthen question... we need to find a support for conclusion that price of natural gas will stay low. Now... since there is no premise (info) about natural gas, the answer should say something about it to draw such conclusion.

(A) OUT OF SCOPE... no indication of that... in fact, the argument is uncertain about the weather.

(B) OUT OF SCOPE... do we care about the fact that they can switch from 1 to 2? how does it support the conclusion that price on natural gas will stay low? THIS ONE IS A TRAP!!!

(C) OUT OF SCOPE... we don't know anything about where the oil/gas comes from

(D) The fuel requirements of industrial users of natural gas are not seriously affected by the weather.
By POE this is the one; Let's negate this one and see what happens:

The fuel requirements of users of nat. gas ARE seriously affected by the weather. Thus, the prices of gas WILL NOT stay lower... AHA -> conclusion FALLS APART... so this is correct choice

(E) Opposite is true... in fact, both oil and gas seem to be affected together

U2, I beg to differ from your analysis on B being out of scope. I think B is the answer. Let me try to explain and some one can correct me if i am wrong.

If as B says, the users can QUICKLY and CHEAPLY switch to oil (whose price is likely to remain low as stated in the stem), this would be all the more reason for the price of natural gas to NOT go up - because if it does, then the users have a CHEAP and QUICK alternative (i.e not requiring any additional overheads).

We need to think about why the products' prices have been corelated - that's because they are competing and products that can also be used as SUBSTITUTES; hence if the price of one goes up, it is likely for the price of the other to go up as well. Ditto for the reverse situation.

What do you think?

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Senior Manager
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29 Jul 2006, 09:08
OA for this is B.

freetheking's response sounds quite valid.

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VP
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29 Jul 2006, 09:17
I agree.. I am wrong here... I fell into the same trap again... but I am not claiming to be correct 100% of time... just some answers overpower the others in my mind... not a big deal...

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Manager
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Re: CR --- Oil prices [#permalink]

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29 Jul 2006, 12:16
mailtheguru 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.

I will go with B.
These are my thoughts.
I think the Q. is asking us to support the conclusion and not find the inference. ( I might be wrong here!!). The conclusion is natural gas prices will not change because oil is cheap.

A. Since the consumers can move from oil to NG. If the price of NG increases then the demand for it will go down, which will obviously will bring the price down again. So this supports the conclusion.

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Manager
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31 Jul 2006, 09:44
Easy B.

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Director
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31 Jul 2006, 11:20
Late but B.

I caught between B and D. I had similar thought like u2lover and corrected myself.

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SVP
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31 Jul 2006, 13:42
I think this one is pretty straightforward. I'll go with B.

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31 Jul 2006, 13:42
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Despite the approach of winter, oil prices to industrial

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