Predator-Prey Dynamics in Demand Destruction & Oil Prices

One of the classic ecological modeling problems is the oscillating populations of predators and their prey in an ecosystem–as prey population rises, predator population follows suit until prey population begins to fall off, resulting in a subsequent drop in predator population (illustrated below). The same dynamic also applies, to some degree, to the relationship between oil price (prey) and marginal production/demand destruction/energy policy (predator). This post will explore that relationship and its ability to help us avoid poor energy policy choices.
The Oil Drum