Massive Oil Find

Can't afford to, I am one of the working poor.

 

And what do you think the average profit margin is at the big oil companies? I'll bet you have no idea.

 

It's currently at ten 10.7% net profit.

Maybe you should read this paper prepared on how energy prices are manipulated by the corporations with the cooperation of the government.

http://www.consumerwatchdog.org/energy/rp/5083.pdf#search="oil companies profit margin"

 

I read the article, but I think its ignorant at best. By the same logic you would be committing a crime if you sold your house for more than the cost of the lumber and nails. Price controls? Is there a more completely discredited policy than that? All you do is create shortages, black markets, and smuggling.

 

That sucks. Got a plan to do something about it?

 

Yeah to live out my life as honestly as I can without doing harm to the world or those living creatures around me. And hopefully to have a little fun a long the way. To experience life and love without turning to dishonesty or nastiness to achieve some sort of falsely perceived sucess that media has sold us as being the true goal in life.

 

Sounds good to me.

 

After reading through this thread, I've seen a few thing not mentioned.

First: You can't pin this entirely one on Saudi Arabia, or OPEC or the Oil Companies or Governments. They each have varying degrees of influence, but for the most part they are simply benefactors of a very complex international market. In general, like all other commodities, the price is based on supply and demand in the international marketplace. If the only players were oil producers and refiners, the market would be well-behaved and would be far more responsive to consumer demand. In recent years oil futures markets, such as the New York Mercantile Exchange (NYMEX), have evolved rapidly to the point where speculative funds have flowed into these markets. This developments has come to influence the daily formation of oil prices. The introduction and recent popularity of trading crude oil and refined product futures changed the market. Here, traders who have no possible way of receiving or refining crude oil purchase contracts and hold them to trade on price fluctuations, at a profit, and before delivery. It is a game fit only for investors with lots of money and willing to take large risks, primarily wealthy traders and those operating high-risk investment and hedge funds. As it turns out, several players of this ilk entered the energy market during the brief Enron era, where they learned the tricks of the trade. Unfortunately, this market was simply overlaid on top of an already functional market with well-entrenched pricing practices. It is the duplication of systems that provides fertile ground for speculative games.

Next: Supply and demand. There are many emerging, expanding & modernizing economies in the world, China is probably the prime example. A lot of these countries have little or no crude oil themselves. Greatly increased demand together with finite and controlled production = higher prices. Add in too little emphasis on conservation & reducing use + too little and too slow expansion of renewable energy sources = still higher prices. And make no mistake about it, reduced need and conversion to non-fossil fuel energy sources worries "them". I learned that in conversations with a Saudi Arabian prince, one of King Faisal's grandsons. He was very, very high up in their Oil Ministry, it was August 1991 and I was having dinner with him at his home (palace). Goes like this... the oil price gets & stays too high = conversion to non-oil = death of the goose with the golden eggs. Of course, that was before the increase in Asian demand and the increased influence of the speculative markets. Of course lack of conservation in this country is still the biggest problem. The United States has the largest demand for oil by far, using around 25% of the world's total oil production and 40% of the world's gasoline production-- with only about 5% of the total world population.

In the early 1970s there was a lot of talk about "running out of oil", well it didn't happen. Too bad, because if it had started actually happening, there would have been mass conversion to renewable energy sources and therefore less (if any) global warming problem. The real bad news is that there is still plenty of crude oil left, so there'll be enough to finish poisoning the planet.

Peace,
poor_old_dad

 

The large companies are controlling the supply! Of course it's supply and demand, but they are controlling what the supply is. W is heavily involved in big oil. I wonder why the profit decrease that was mentioned was only during the years that a Bush wasn't in office?

 

Yeah, and I wonder why the U.S. based oil companies haven't been hit with a windfall profit tax too.

And it's not just Bush. Another oil giant in the Bush administration is Vice President Dick Cheney. Vice President Cheney was Chairman and Chief Executive of Dallas based Halliburton Corporation, the world’s largest oil field services company with multi-billion dollar contracts with oil corporations including Chevron. Lawrence Eagleburger, a seasoned Bush counselor who held top State Department posts under George Bush Sr., is a director of Halliburton Corporation.

Plus Condoleezza Rice. She also headed Chevron's committee on public policy until she resigned on January 15, 2001, to become National Security Advisor to President George W. Bush. Chevron honored Rice by naming an oil tanker Condoleezza Rice after her, but controversy led to its being renamed Altair Voyager. http://www.aztlan.net/oiltanker.htm

Peace,
poor_old_dad

 

Yes but if we hit oil companies with a windfall tax whenever prices go up, it reduces the incentive to invest in new capacity. Making investment in oil less appealing is not going to bring prices down.

 

No new refineries have been built in the United States since 1976. As a result, the US is becoming more and more dependent on the imports of finished gasoline.

What will bring prices down is reduced use, side benefit is that is also a key step in saving the planet.

Peace,
poor_old_dad

 

Holy conflict of interest batman! Not that I didn't know, just that seeing it spelled out again makes me cringe.