The oil price shocks

Oil is an important commodity in modern economies. Oil and its derivatives provide fuel for heating, transport, and machinery, and are basic inputs for the manufacture of industrial petrochemicals and many household products ranging from plastic utensils to polyester clothing. From the beginning of this century until 1973 the use of oil increased steadily. Over much of this period the price of oil fell in comparison with the prices of other products. Economic activity was organized on the assumption of cheap and abundant oil.

In 1973 - 74 there was an abrupt change. The main oil-producing nations, mostly located in the Middle East but including also Venezuela and Nigeria, belong to OPEC – the Organization of Petroleum Exporting Countries. Recognizing that together they produced most of the world's oil, OPEC decided in 1973 to raise the price at which this oil was sold. Although higher prices encourage consumers of oil to try to economize on its use, OPEC countries correctly forecast that cutbacks in the quantity demanded would be small since most other nations were very dependent on oil and had few commodities available as potential substitutes for oil. Thus OPEC countries correctly anticipated that a substantial price increase would lead to only a small reduction in sales. It would be very profitable for OPEC members.

Oil prices are traditionally quoted in US dollars per barrel. Some figures show the price of oil from 1970 to 1986. Between 1973 and 1974 the price of oil tripled from $2,90 to $9 per barrel. After a more 80

gradual rise between 1974 and 1978 there was another sharp increase between 1978 and 1980, from S12 to $30 per barrel. The dramatic price increases of 1973 - 79 and 1980-82 have become known as the OPEC oil price shocks, not only because they took the rest of the world by surprise but also because of the upheaval they inflicted on the world economy, which had previously been organized on the assumption of cheap oil prices.

People usually respond to prices in this or that way. When the price of some commodity increases, consumers will try to use less of oil but producers will want to sell more of it. These responses, guided by prices, are part of the process by which most Western societies determine what, how and for whom to produce.

Consider first how the economy produces goods and services.

When, as in the 1970s, the price of oil increases six-fold, every firm will try to reduce its use of oil-based products. Chemical firms will develop artificial substitutes for petroleum inputs to their production processes; airlines will look for more fuel-efficient aircraft; electricity will be produced from more coal-fired generators. In general, higher oil prices make the economy produce in a way that uses less oil.

How does the oil price increase affect what is being produced?

Firms and households reduce their use of oil-intensive products, which are now more expensive. Households switch to gas-fired central heating and buy smaller cars. Commuters form car-pools or move closer to the city. High prices not only choke off the demand for oil-related commodities; they also encourage consumers to purchase substitute commodities. Higher demand for these commodities bids up their price and encourages their production. Designers produce smaller cars, architects contemplate solar energy, and research laboratories develop alternatives to petroleum in chemical production. Throughout the economy, what is being produced reflects a shift away from expensive oil-using products towards less oil-intensive substitutes.

The for whom question in this example has a clear answer.

OPEC revenues from oil sales increased from $35 billion in 1973 to nearly $300 billion in 1980. Much of this increased revenue was spent on goods produced in the industrialized Western nations. In contrast, oil- 81

importing nations had to give up more of their own production in exchange for the oil imports that they required. In terms of goods as a whole, the rise in oil prices raised the buying power of OPEC and reduced the buying power of oil-importing countries such as Germany and Japan.

The world economy was producing more for OPEC and less for Germany and Japan. Although it is the most important single answer to the 'for whom' question, the economy is an intricate, interconnected system and a disturbance anywhere ripples throughout the entire economy.

In answering the ‘what' and 'how' questions, we have seen that some activities expanded and others contracted following the oil price shocks. Expanding industries may have to pay higher wages to attract the extra labour that they require. For example, in the British economy coal miners were able to use the renewed demand for coal to secure large wage increases. The opposite effects may have been expected if the 1986 oil price slump had persisted.

The OPEC oil price shocks example illustrates how society allocates scarce resources between competing uses.

A scarce resource is one for which the demand at a zero price would exceed the available supply. We can think of oil as having become more scarce in economic terms when its price rose.

Tasks to the topic:

1. Suggest the Russian equivalents: to increase steadily; try to economize on the use of...; to choke off the demand; to encourage consumers to purchase smth.; to encourage the production of...

2. Replace the parts in italics by synonyms: three economic questions; to give a share resources; to have scarce supplies of raw materials; a sudden change; realising that; potential replacements; to encourage people who use oil; price increases six times; try to cut down on the use of oil

3. Find in the text antonyms for the following words: rare, scarce; outputs; expensive; exports; straightforward; get, acquire; not to need; getting smaller

4. Fill in the gaps with the words and expressions from the text

a) Economics is the study of how people choose ___scarce resources to

satisfy their___.

b) Economic activity was organized on the assumption of___oil.

c) In 1973 - 74 there was an _____change in oil prices.

5. What can you tell about the present-day situation on the oil-market?

Telephoning

Making a Call

I. When you make a call:

1. First check the code (if any) and number.

2. Lift the receiver and listen for dialing tone (a continuous purring).

3. Dial carefully and allow the dial to return freely.

4. Then wait for another tone:

Ringing tone (burr-burr) the number is being called. The line is free. Engaged tone (a repeated single note) try again a few minutes later. Number unobtainable-tone (steady note) replace the dialer, recheck the code and number, and then redial. 5. At the end of the call, replace the receiver securely.

II. When you answer the telephone:

1. Always give your name: or the name of the office or your telephone number.

2. If your hear a series of rapid pips, the call is coming from a coin-box telephone. Wait until the pips stop and then give your name or telephone number.

III. When you make a call from a coin-box telephone:

1. First drop a coin piece (or pieces) info the slot.

2. Lift the receiver and listen for dialling tone.

3. Dial your number.

4. On hearing ringing tone, which means that the line is free, wait until your call is answered.

IV. When you make a call from an extension phone:

1. Wait for the switchboard operator to say: "Number, please", or "Switchboard operator". 83

2. Give the number of the person you are calling. The operator will either repeat your number to make sure she got it right, or just say: "Thank you" and try to put you through.

3. Wait until your call is answered.

Here are some examples of conversations:

Making an Appointment

Secretary: Two-four-nine; double eight-double two.

Mr. Ivanov: I would like to make an appointment with Mr. Jeffries. This is Mr. Ivanov speaking. Secretary: Oh, yes, Mr. Ivanov. Good morning. I'll get his schedule. Are you there?

Mr. Ivanov: Yes.

Secretary: When would you like to come, Mr. Ivanov?

Mr. Ivanov: Tomorrow, if possible.

Secretary: I'm afraid he's tied up tomorrow. Is it urgent? If it is, perhaps we could fit you in somewhere.

Mr. Ivanov: No, it isn't that urgent. Is the day after tomorrow possible?

Secretary: What time would you like to come?

Mr. Ivanov: As late as possible in the afternoon.

Secretary: I'm sorry, that afternoon's full too. How is Friday afternoon at five?

Mr. Ivanov: Yes, that's perfect, thank you. Good-bye.

Leaving a Message

(to be taken with "Inquiries")

Mr. Clark: Mrs. Henderson?

Mrs. Henderson: Yes.

Mrs. Clark: Ma'am, my name is Ray Clark. I'm a friend of Mutt's and Jiggs Casey's. Jiggs gave me your phone num­ber and told me to call when I got to town. I just missed Mutt in Washington.

Mrs. Henderson: Oh, that's too bad. Mutt got it late Monday, but he had to go right out to the base. I'm afraid he'll be there through the weekend, too.

Mr. Clark: Any way I can reach him? 84

Mrs. Henderson (laughing): If you find out, please tell me. I don't even know where it is.

Mr. Clark: You mean you've never even seen it?

Mrs. Henderson: Well, he did show me the general direction once when we were driving over to White Sands, so at least I know my husband's not in Alaska.

Mr. Clark: Service wives have it rough .

Mrs. Henderson: You're not in the service? (Mrs. Henderson's voice became guarded.)

Mr. Clark: Oh, sure. (Clark lied.) That's how I know how it is. Or, rather, my wife does. They keep me traveling all the time.

Mrs. Henderson: Oh. (She sounded relieved.) Well, tell me where you are stopping, and if he does get home, I'll have him call you.

Mr. Clark: Sorry. (He lied again.) I've got to fly to L. A. this afternoon. Just tell him Ray called. And thanks anyway, Mrs. Henderson.

Tasks to the topic:

1. Study the topic and translate all texts.

2. Make up your own instruction for mobile phone based on the first text.

3. Continue the dialogue with Ivanov and Mr. Jeffries discussing the terms of contract.

4. Guess and play all possible situations you may be engage in using telephone for business.

The Law of Life

by Jack London

The old Indian was sitting on the snow. It was Koskoosh, former chief of his tribe. Now all he could do was sit and listen to the others. His eyes were old and he could not see, but his ears were wide-open to every sound.

Aha! That was the sound of his daughter, Sit-Cum-To-Ha. She was beating the dogs, trying to make them stand in front of the snow sleds. He was forgotten by her, and by the others, too. They had to

look for new hunting grounds; the long snowy ride waited. And the days of the northlands were growing short. The tribe could not wait for death, and Koskoosh was dying.

The stiff crackling noises of frozen animal skins told him that the chief's tent was being torn down. The chief was a mighty hunter. He was his son, the son of Koskoosh. And Koskoosh was being left to die. As the women worked, old Koskoosh could hear his son's voice drive them to work faster. He listened harder. It was the last time he would hear that voice. A child cried and a woman sang softly to quiet it. The child was Koo-tee, the old man thought, a sickly child. It would die soon and they would burn a hole in the frozen ground to bury it. They would cover its small body with stones to keep the wolves away. Well, what of it? A few years, and in the end, death. Death waited ever hungry. Death had the hungriest stomach of all.

Koskoosh listened to other sounds he would hear no more: the men tying strong leather rope around the sleds to hold their belongings, the sharp sounds of leather whips ordering the dogs to move and pull the sleds. Listen to the dogs cry! How they hated the work! They were off-sled after sled moved slowly away into the silence. They had passed out of his life, and he must meet his last hour alone. But what was that?

The snow packed down hard under someone's shoes. A man stood beside him and placed a hand gently on his old head. His son was good to do this. He remembered other old men whose sons had not done this, but left without a good-bye. His mind traveled into the past until his son's voice brought him back.

"It is well with you?" his son asked. And the old man answered. "It is well."

"There is wood next to you and the fire burns bright," the son said. "The morning is gray and the cold is here. It will snow soon. Even now it is snowing."

"Aye, even now it is snowing."

"The tribesmen hurry. Their loads are heavy and their stomachs flat from little food. The way is long and they travel fast."

"Aye."

"I go now. All is well?"

"It is well. I am as last year's leaf that sticks to the tree. The first breath that blows will knock me to the ground. My . . . my voice is like an old woman's. My eyes no longer show me the way my feet go. I am tired and all is well."

He lowered his head to his chest and listened to the snow as his son rode away. He felt the sticks of wood next to him again. One by one the fire would eat them, and step by step death would cover him. When the last stick was gone, the cold would come. First his feet would freeze, then his hands. The cold would travel slowly from the outside to the inside of him, and he would rest. It was easy-all men must die.

He felt sorrow, but he did not think of his sorrow. It was the way of life. He had lived close to the earth, and the law was not new to him. It was the law of the flesh. Nature was not kind to the flesh. She was not thoughtful of the person alone. She was interested only in the group ... the race ... the species. . . .

This was a deep thought for old Koskoosh, but his half-civilized mind knew it. He had seen examples of it in all his life. The tree sap in early spring, the newborn green leaf soft and fresh as skin, the fall of the yellow dry leaf-in this alone was all history.

He placed another stick on the fire and began to remember his past. He had been a great chief, too. He had seen days of much food and laughter-fat stomachs- when food was left to rot and spoil; times when they left animals alone unkilled; and days when women had many children.

And he had seen days of no food and flat stomachs; days when the fish did not come and the animals were hard to find. For seven years the animals did not come, and the dogs were nothing but tight flesh and bones.

And then he remembered, when a small boy, how he watched the wolves kill a moose. He was with his friend, Zing-Ha, who was killed later in the Yukon River. Ah, but the moose! Zing-Ha and he had gone out to play that day. Down by the river they saw fresh steps of a big heavy moose. "He's an old one," Zing-Ha had said. "He cannot run like the others, and has fallen behind. The wolves separated him from the others, and they will never leave him." 87

And so it was. By day and night, never stopping, biting at his nose, biting at his feet, the wolves stayed with him until the end. Zing-Ha and he had felt the blood quicken in their bodies. The end would be a sight to see.

They had followed the steps of the moose and the wolves. Each step told a different story. They could see the tragedy as it happened. Here was the place the moose stopped to fight. The snow was packed down for many feet. One wolf had been caught by the heavy feet of the moose and kicked to death. Farther on they saw how the moose had struggled to escape up a hill, but the wolves had attacked from behind. The moose had fallen down and crushed two wolves. But it was clear the end was near. The snow was red ahead of them. Then they heard the sounds of the battle. Not the clear long wolf sounds all barking together, but the short teeth sounding noises as they bit the flesh.

He and Zing-Ha moved closer on their stomachs, so the wolves would not see them. They saw the end and the picture was so strong. It had stayed with him all his life. His dull, blind eyes saw the end again as they had in the far-off past.

For long his mind saw his past. The fire began to die out, and the cold entered his body. He placed two more sticks on it-just two more left. This would be how long he would live. It was very lonely. He placed one of the last pieces of wood on the fire.

Listen! What a strange noise for wood to make in the fire! No, it wasn't wood, and his body shook as he recognized the sound. Wolves! The cry of a wolf brought the picture of the old moose back to him again. He saw the clean bones lying gray against the frozen blood. He saw the rushing forms of the gray wolves, their shining eyes, their long wet tongues, and sharp teeth. And he saw them form a circle and move ever slowly closer and closer.

A cold, wet nose touched his face. At the touch his soul jumped forward to awaken him. His hand went to the fire and he pulled a burning stick from it. The wolf saw the fire, but was not afraid. It turned and shouted into the air to his brother wolves. They answered with hunger in their throats and came running. The old Indian listened to the hungry wolves. He heard them form a circle around him and

his small fire. He waved his burning stick at them, but they did not move away.

Now one of them moved closer, slowly, as if to test the old man's strength. Another and another followed. The circle grew smaller and smaller. And not one wolf stayed behind. Why should he fight? Why cling to life? And he dropped his stick with the fire on the end of it. It fell in the snow and the light went out.

The circle of wolves moved closer, and once again the old Indian saw the picture of the moose as it struggled before the end came. He dropped his head to his knees. What did it matter after all? Isn't this the law of life?

Way of the Star

devoted to my father

A man was born in the world. His name “Albin” was like a sign of star. One more star had appeared…This star isn’t a sort of an asteroid. It is the essence of a human. Some philosophers may say “quinta essentia” or “existence”, theologians name it “soul”. According to the author “star” doesn’t conflict with the previous notions. It only shows some subtle feature of a human. Often we don’t pay any attention to persons around. But being more attentive we may notice that in some cases persons familiar us may be like lodestars for lonely sealers or travelers. We are so used to stars and have notice their presence after they are disappeared. People appear not by accident. Their course of life is like a way of wanderer full of feats and mistakes. Some acts of people can hide the true light of their internal luminaries. We should be very solicitous about people around. We should be sharp-sighted to the stars and may see sky around but not only notice it above us, otherwise we run the risk to loose skies. Let God rest in the souls of tired stars.

Tasks to the topic:

1. Read the text and translate it in a written form.

2. Who was Koskoosh?

3. Why did Jack London named this work “The Law of Life”?

4. Answer two last questions to “The Law of Life” and finish the text.

5. Do you agree to be careful with people you know? Does it correspond with the golden rule of behavior “Act with others as you want to act with you”?

Free Manners

Travelling to all corners of the world gets easier and easier. We live in a global village, but how well do we know and understand each other? Here is a simple test. Imagine you have arranged a meeting at four o'clock. What time should you expect your foreign business colleagues to arrive? If they're German, they'll be bang on time. If they're American, they'll probably be 15 minutes early. If they're British, they'll be 15 minutes late, and you should allow up to an hour for the Italians.

When the European Community began to increase in size, several guidebooks appeared giving advice on international etiquette. At first many people thought this was a joke, especially the British, who seemed to assume that the widespread understanding of their language meant a corresponding understanding of English customs. Very soon they had to change their ideas, as they realized that they had a lot to learn about how to behave with their foreign business friends.

For example:

The British are happy to have a business lunch and discuss business matters with a drink during the meal; the Japanese prefer not to work while eating. Lunch is a time to relax and get to know one so another, and they rarely drink at lunchtime.

The Germans like to talk business before dinner; the French like to eat first and talk afterwards. They have to be well fed and watered before they discuss anything. Taking off your jacket and rolling up your sleeves is a sign of getting down to work in Britain and Holland, but in Germany people regard it as taking it easy.

American executives sometimes signal their feelings of ease and importance in their offices by putting their feet on the desk whilst on the telephone. In Japan, people would be shocked. Showing the soles

of your feet is the height of bad manners. It is a social insult only exceeded by blowing your nose in public.

The Japanese have perhaps the strictest rules of social and so business behaviour. Seniority is very important, and a younger man should never be sent to complete a business deal with an older 55 Japanese man. The Japanese business card almost needs a rulebook of its own. You must exchange business cards immediately on meeting because it is essential to establish everyone's status and position. When it is handed to a person in a superior position, it must be given and received with both hands, and you must take time to read it carefully, and not just put it in your pocket! Also the bow is a very important part of greeting someone. You should not expect the Japanese to shake hands. Bowing the head is a mark of respect and the first bow of the day should be lower than when you meet thereafter.

The Americans sometimes find it difficult to accept the more formal Japanese manners. They prefer to be casual and more informal, as illustrated by the universal 'Have a nice day!' American waiters have a one-word imperative 'Enjoy!' The British, of course, are cool and reserved. The great topic of conversation between strangers in Britain is the weather- unemotional and impersonal. In America, the main topic between strangers is the search to find a geographical link. 'Oh, really? You live in Ohio? I had an uncle who once worked there.'

"When in Rome, do as the Romans do" .

Here are some final tips for travellers:

In France you shouldn't sit down in a cafe until you've shaken hands with everyone you know.

In Afghanistan you should spend at least five minutes saying hello.

In Pakistan you mustn't wink. It is offensive.

In the Middle East you must never use the left hand for greeting, eating, drinking, or smoking. Also, you should take care not to admire anything in your hosts' home. They will feel that they have to give it to you.

In Russia you must match your hosts drink for drink or they will think you are unfriendly. 90

In Thailand you should clasp your hands together and lower your head and your eyes when you greet someone.

In America yon should eat your hamburger with both hands and as quickly as possible. You shouldn't try to have a conversation until it is eaten.

Adapted by Tatyana N. Ishkova from the article by Norman Ramshaw

Web Etiquette

There are a few conventions which will make for a more usable, less confusing, web. As a server administrator, or webmaster as they are known (the term having been coined on this page, below) you should make sure this applies to your data. This Guide gives more ideas for all information providers. See especially:

Signing your work -- especially the welcome page.

Giving its status

Your server administrator needs these things set up once per server:

A welcome page for outsiders

You don't have to have any particular structure to the data you publish: you can let it evolve as you think best. However, it is neat to have a document on each host which others can use to get a quick idea (with pointers) of what information is available there. You should put a "pass" line into your daemon rule file to map the document name "/" onto such a document. As well as a summary of what is available at your host, pointers to related hosts are a good idea.

Welcome home?

The welcome page for a server is often now called a "home" page because it is a good choice for a client to use as a home (default) page. The term "home" page means the default place to start your browser. Don't be confused by this, though. There are two separate concepts.

The welcome page will be welcoming those new to your server who want an overview of what it contains. It will serve a similar purpose to your home page, but it differs in the audience it addresses. Often, it 92

only confuses things to have to, so people within the organization use the welcome page as their home. This at least ensures that they are aware of the public view of the organization. I don't do this myself, as I have many personal things on my home page, which I don't want on the organization's welcome page nor my own "welcome" page, my Bio. A welcome page may have explanations about what your server is all about which would be a waste of space on a home page for your local users. So you may want to make a separate home page for local users.

An alias for your server

If you have a serious server then it may last longer than the machine on which it runs. Ask your internet domain name manager to make an alias for it so that you can refer to it, instead of as "mysun12.dom.edu" as "www.dom.edu". This will mean that when you change machines, you move the alias, and people's links to your data will still work.

In the future [3/94] clients come out of the box configured to look for a local "www" machine, to use its welcome page as "home" if no other default is specified. This means that anyone starting such a client within your domain will get a relevant place to start.

An alias for yourself

You should make a mail alias "webmaster" on the server machine so that people who have problems with your server can mail you about it easily. This is similar to the "postmaster" alias for people who have mail problems with your machine.

Delegating control

The server administrator (the one with the root password) in principle has the power to turn the thing on or off, and control what happens. However, it is wise to have clearly delegated responsibility for separate areas of documentation. Maybe the server administrator has no responsibility at all for the actual content of the data, in which case he or she should just keep the machine running properly.

House style

The web has spread from the grass roots, without a central authority, and this has worked very well. This has been due in part to 93

the creativity of information providers, and the freedom they have to express their information as directly and vividly as they can. Readers appreciate the variety this gives. However, in a large web they also enjoy a certain consistency.

If you are a person responsible for managing the information provided by your organization, you have to balance the advantages of a "house style" with the advantages of giving each group or author free rein. If you end up with decisions in this area, it is as well to write them down (not to mention put them on the web).

Tasks to the topic:

1. Read the texts and translate it in a written form.

2. Explain in your own word notion “etiquette”, does it equal “good manners?

3. What kind of interesting information about some habits do you know (tell about them)?

4. Do we need good manners or not (explain)?

5. Comment the last text

APPENDIX I

Date: 2016-01-05; view: 1352