I read the following passage in David D. Friedman’s Hidden Order

I read the following passage in David D. Friedman’s Hidden Order: The Economics of Everyday Life (published in ’97):

In the previous discussion, we were considering a pure depletable resource — a resource whose price was entirely determined by its limited supply. Consider at the other extreme, a resource of which only a limited amount exists but for which production costs are substantial and for which that “limited amount” is very large compared to the quantity demanded at a price sufficient to cover the cost of production. The amount is so large that technology, law, and political institutions will have changed beyond recognition long

before the supply is exhausted.

Under those circumstances, saving the good now in order to sell it when supplies run short is not a very attractive idea — before that happens we may have stopped using it, the owner may have been expropriated, or the world may have ended. Changes in its price over time will be almost entirely determined by changes in production cost. The good is, strictly speaking, depletable, but that fact has no significant effect on its price. The pattern of oil prices over the past ninety years or so suggests that that may well be how the market views petroleum.