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u/mikybob12 is right: it's about (no pun intended) sunk costs (ie capital expenditure) and operating expenditure

The CapEx to get a drill up and running is huge

But the OpEx to keep it running is minimal

Think about the cost to build a house vs living in it – your monthly cost to run a house is, say, $2000 (taxes, maintenance, utilities, etc)

But it cost $250,000 in the first place

Same thing with oil rigs – the millions of $$$ spent to build it have been spent: whether it's used or not

So you might as well use it

April 20, 2020 at 09:10AM
via reddit https://www.reddit.com/r/Economics/comments/g4s0y2/us_oil_prices_on_pace_for_their_worst_day_ever_as/fnz7ske?utm_source=ifttt