Grey Markets

Learning about the shadow fleet of vessels that carry oil around the world has been interesting. My brain opened up when I started thinking about how Russia is generating income for its war in Ukraine, and those shadow tankers have a lot to do with it.

They carry oil that “doesn’t really exist” around the world, selling it to nations who don’t mind paying a little less money for something they’re not supposed to be buying, at least according to other nations.

The more barrels of oil sold from the shadow fleet, the lower the price of oil tends to be worldwide, even in non-grey markets.

Official markets act as though the grey markets don’t exist. They ignore or scoff at those illegitimate traders, but their prices certainly pay attention to the grey market supply. After all, it’s all about supply and demand, not merely legitimate supply vs legitimate demand.

Imagine I’m a high school junior, able to drive on my own for the first time. I end up buying a few comic books at a flea market, picking them up at a nice discount. I take these comics to a legit comic book shop a few miles away, and I make a few extra bucks selling them. In return, he makes a few extra bucks buying it from me, since he’ll mark it way up to the official price.

Where’d you get these comics from, kid?
…isn’t something you’d typically overhear.

I was a flea market kid, but other kids might have been shoplifters who came across their comic books via more sketchy means. It didn’t make any difference to Comic Book Guy, though.

Whether I bring in my legit comics from the flea market, or Shoplifter Shaun brings his five-finger discounts in, it makes no difference as to how it affects the price. By contrast, Shaun might have bought these stolen comics wholesale from the heist expert down the street—just a quick sale to evade law enforcement at a deep discount.

Shaun is part of the black market, but I am not.

Now, imagine that Marvel Comics has a deal with one particular comic book chain, and only that chain can get certain back issues from Marvel at a deep discount.

Seeing how profitable this deal is, Comic Book Guy gets greedy. He orders a thousand copies of Punisher #1, then sells them at a deep discount from the current market price to a dozen stores in the area.

This is the grey market.

Cheaper comics at the comic store, higher profits for the store owner—Comic Book Guy might be violating a distribution agreement, but the goods themselves are legitimate. It’s just that they don’t travel through official channels.