Adelman, Morris Albert
Morris Albert Adelman (1917-), an American energy economist noted for his founding work in the development of the economics of oil supply and the world oil market. Central to his work is the notion that oil is a commodity like any other; he did not assign a special status to oil as a depleting resource or as an increasing-cost good. He views the oil industry's supply problem as an issue of inventory renewal. The rule of thumb is that the industry should hold about 15 years' supply in the ground as proven reserves. As we deplete a mineral base, its market price is typically expected to rise, creating an incentive to replenish the inventory via exploration and development. Adelman’s rule is a practical tool for valuing oil reserves based on current prices and extraction costs. However, Adelman engaged in a long-running public debates with analysts holding more pessimistic views of oil supply markets.