"On the macro level, corruption distorts market mechanisms, like fair competition...The World Economic Forum estimates that corruption increases the cost of doing business by up to 10% on average. "
As to whether ISIS oil is cheaper, I don't know about that, but if so, perhaps that could be because it was stolen from its rightful owners. I don't think you can use that to draw a conclusion that corruption causes costs to go down.
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>corruption increases the cost of doing business
these statements make sense and are true only than normal competition is a real alternative. Which it isn't in those corrupted countries.
Without normal competition as a feasible alternative, the things are the other way around. Corruption way of doing things is cheaper, while doing things "by the book" is much more expensive if at all possible (an attempt to do "by the book" is basically denying government people an income they are "entitled to" and they don't take it lightly and would make sure that it is less profitable for you :)
it works the other way. There is no environmental controls and proper taxation on corrupted contracts by corrupted governments. So the price of such oil is cheaper. Just think - who would pay a bribe to obtain something for a higher price than it would be without a bribe?
>The current situation of rock bottom oil prices
and the cheapest oil is from ISIS - one of the reasons for current low prices. It is the most corrupt oil - to get into your car as gas it passed through the most corrupt laundering "pipelines" in Turkey and Saudi Arabia and further to Ukraine and Poland...