Ask yourself what the profit is on the marginal barrel.
When you sell countless barrels year after year, I'd take a 10 cent profit per $100 barrel. Its more than I make now.
Totally missing the point. The world wants that 87,400,000th barrel. And the cost to produce and transport that barrel is around $100 or whatever.
The 20,000,000th barrel probably costs $20. Or something. Nobody knows.
If oil drops to $90 eventually those extra barrels disappear. But the world still wants them. So the price has to go up.
How much does the 90,000,000th barrel cost? $130? Small changes in supply/demand balances can have huge impacts on price in inelastic markets.