Despite the approach of winter, oil prices to industrial : GMAT Critical Reasoning (CR)
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# Despite the approach of winter, oil prices to industrial

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

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05 Dec 2006, 09:27
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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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05 Dec 2006, 10:00
i think its A...as the winter is going to be mild there is no reason for the prices to go up...nd thus, natural gas will also be cheaper....
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05 Dec 2006, 10:42
clear B
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05 Dec 2006, 12:23
i say D
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05 Dec 2006, 13:16
It's B.

Since oil price is cheap, industrial users will make use of the oppurtunity to run their business profitable. So natural gas will be available plenty and gas distributors will have no chance to increase the price.
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05 Dec 2006, 14:01
I would have to say B. Thats the only one that shows a relationship between oil and natural gas. I did not completely understand it though.
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05 Dec 2006, 17:03
C it is
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05 Dec 2006, 17:55
C it is
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05 Dec 2006, 20:25
I was leaning towards A, B is little out of scope, what if everone switches to oil and then oil prices rise too and then they switch back to NG

so it is not really clear

Anybody else with A?
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05 Dec 2006, 20:47
I knew A is not the one,Even though I am not sure what is the correct answer,.

Fact: 'Long-term weather forecasts predict a mild winter. '
SUPPORTS
Conclusion: 'unless the winter is especially severe, the price of natural gas to industrial customers is also likely to remain low. '

Don't you see something is not right?
The conclusion is not " winter is not severe", but
"IF Winter severe , THEN price will rise. ".
_________________

livin in a prison island...

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Re: CR: Oil prices Vs Gas prices [#permalink]

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05 Dec 2006, 21:50
By POE, it comes to B.

But can we assume in B that users can actually substitute natural gas with oil?
Also, What about the relative prices of natural gas and oil? May be oil normally costs $7/gallon (exaggerated figure) in winters and this year it is$4. And natural gas may normally be $0.5, but in severe winters it could go upto$3. Even then natural gas could be a cheaper alternative.
aurobindo 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.
clearly out
(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.
No mention of subtropical regions
(D) The fuel requirements of industrial users of natural gas are not seriously affected by the weather.
contradicts: unless the winter is especially severe, the price of natural gas to industrial customers is also likely to remain low
(E) Oil distribution is more likely to be affected by severe winter weather than is the distribution of natural gas.
contradicts: Oil prices are likely to remain low. Natural gas prices will remain low if winters not severe
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06 Dec 2006, 04:20
OA is B.
06 Dec 2006, 04:20
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