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Old 02-25-2012, 06:21 PM   #57
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Originally Posted by Tyler6357 View Post
America should flood the market with oil to increase supply, lower prices and reduce the power of OPEC to control those prices in the future. Once the supply of oil starts to out pace the increase in demand, OPEC's power and arbitrary supply limits will have less and less influence over the price of oil giving them even less control. They will also lose customers to those pumping oil costing them more money. Also, consider that as prices drop demand will increase as more people can afford to travel. It might be more profitable to sell 50 barrels at $100/barrel than to sell 100 barrels for $50/barrel, but it is also more profitable to sell 1000 barrels at $50/barrel ($50,000) than it is to sell 100 barrels at $100/barrel ($10,000). It's much like Henry Ford who was able to make much higher profits than other car companies even though Ford charged less per car because they made up for it in volume. It's much like when the government increases tax rates, taxpayers flee the country, hide their money, engage in less business creation and commerce causing tax revenue to go down. Would you rather have 50% of $10 or 10% of $100? This is simple supply side economics.
Any oil company that is pumping oil will want to pump as much as possible and sell it at market prices to maximize profits. The more they sell the more profits they make. They don't have the luxury of setting prices. Prices are set by speculating what the supply and demand will be in the future.
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Originally Posted by Clifftall View Post
I'm afraid this is a pipe-dream ( couldn't help it , sorry ). America is a great Country and a lot of good things , however we are not an oil co. Furthermore I would venture to say that most co's drilling here are not American co's.
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No, it's not a "pipe dream", it's actually called economics (haha, sorry, I couldn't help it). Of course the country is not an oil company. The truth is that it doesn't really matter if most oil co's drilling in America are actually American companies or not because drilling oil will increase world oil supplies and when they are increased faster than increases in demand for oil lower prices will result no matter if the company is an American one, British one, or anything else, that is the point. It doesn't even matter if they are drilling in America or not just so long as they drill.
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Originally Posted by LadyFitz... View Post
The reason you will never see that happen is there is a finite supply of oil in the ground. The oil companies want that supply to last as long as possible. As I already said, the oil companies are in the oil shortage business. Besides, most of the prices increases we are seeing right now are from speculators, not the oil companies.
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Originally Posted by raycon9 View Post
no one has mentioned this so i will throw it in.

according to "CNBC" the world supply of oil is 137 million bb/day.
the world demand is 135 million bb/day.
American demand is going down.
China and Indian demand goes up every day.
Aren't those supply/demand numbers a big part of what's going on with the fuel price ??
therefore, if we drill more wont the balance shift? JMO
Here is my take on all of this, There is only one way to flood the market with oil, that's for the government to release oil from the strategic oil reserves. This won't happen because the same thing that is causing speculators to drive up prices, unrest between Iran and Israel, will cause the government to sit on the reserves. Oil companies cry drill baby drill, but they have capped wells waiting for the right price to bring them to market. This is real capitalism, doesn't matter who pays the price, it's all about profits. JMHO
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Old 02-25-2012, 06:40 PM   #58
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I respectfully disagree. This assumes that an increase in domestic oil production doesn't affect world prices which is totally unrealistic. If America were pumping more oil then America would be increasing the world supply of oil thus putting downward pressure on the price of oil on world markets. If America was flooding the market with oil then those speculators would be speculating that the price is going to drop instead of rise and prices would come down quickly. The Saudis cut and increase supply to affect the price of oil all the time. Why do you think OPEC was formed? The answer is to control the price of oil by limiting production. The truth is, speculation is based on supply and demand. When supply increases at a quicker rate than the demand increases prices go down, when it doesn't they go up, plain and simple.
Domestically, we sit on something like 2% of the world's oil. You said it yourself, OPEC constantly throttles their oil supply to keep prices at the pain threshold. You don't think they can cut production far enough to offset any increase we can muster? If not, you're right.

We simply cannot produce enough oil to flood the world market, overwhelm OPEC, and affect prices. Even if we could, domestic oil producers have no motivation to do so, and even if they did (like government intervention) it would be a short ride, then back to the same old thing.
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Old 02-25-2012, 08:07 PM   #59
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Two , three days ago I watched some talking head on Fox Bus. talking about green energy. She said "We can't put algae in the gas tank." True, but we can't put crude in either. If this country does not change over to renewable energy we will always be at the mercy of others. Even coal and natural gas is limited. I did notice that the feds have approved two new nuclear energy plants.
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Old 02-25-2012, 08:29 PM   #60
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you just nailed it right on the head! again the # 1 export in 2011 was finished oil products. I work in a 70,000 bpd refinery in pa. and we cannot keep a level in our tanks, selling everything we make. gas just jumped 15 cents yesterday i think
WHICH also explodes the "we NEED oil speculators and the Commodity market for oil to STABILIZE the production and supply" - THAT argument is great for seasonal crops and irregular harvests - but OIL doesn't fit that category - it's sold as fast as it can be produced and refined/delivered - the "control" is done at the well, with the twist of a valve...

OR on wall street in the commodity markets...
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Old 02-25-2012, 09:12 PM   #61
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It is truly a supply and demand problem. When did anyone in the USA build a refinery? Not in recent years, but how many autos, and truck have been added within our society? Many!
How much exploration and development of oil fields has occured or is happening now, very little.
The problem is our polititians and our society bowing down at the altar of the environmentalists!
Until this problem is resolved we will continue to sink deeper and deeper into the mire we are currently experiencing!
If we had began to drill and explore 5 years ago or 10 years ago, we could now be reaping the benefits of that work, but we MUST have some additional refining capacity.
WE MUST have some competition to get the price down and that will only come with increased exploration and refining capacity!
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Old 02-25-2012, 09:46 PM   #62
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It is truly a supply and demand problem. When did anyone in the USA build a refinery? Not in recent years, but how many autos, and truck have been added within our society? Many!
How much exploration and development of oil fields has occured or is happening now, very little.
The problem is our polititians and our society bowing down at the altar of the environmentalists!
Until this problem is resolved we will continue to sink deeper and deeper into the mire we are currently experiencing!
If we had began to drill and explore 5 years ago or 10 years ago, we could now be reaping the benefits of that work, but we MUST have some additional refining capacity.
WE MUST have some competition to get the price down and that will only come with increased exploration and refining capacity!
CarlGeo
From what I've read, for the first time in recent history the US is a net exporter of refined petroleum. Yet in the Philadelphia region 3 refineries have or are in the process of being closed. The reason quoted is that they are unprofitable. They can't find anyone to purchase them. Sun oil is getting out of the refining business and concentrating on retailing "a more profitable enterprise". Oil companies are sitting on capped wells waiting of the right price, here and abroad. As I said this is what capitalism is, profits above all.
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Old 02-25-2012, 10:20 PM   #63
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Try this link, maybe it will refresh some memories. Oil is supply and demand, there is no secret conspiracy.

It is as simple as this, We want it, They have it. We are stuck until we don't want it anymore.

http://inflationdata.com/inflation/i...ices_table.asp
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Old 02-25-2012, 10:49 PM   #64
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Originally Posted by CarlGeo View Post
It is truly a supply and demand problem. When did anyone in the USA build a refinery? Not in recent years, but how many autos, and truck have been added within our society? Many!
How much exploration and development of oil fields has occured or is happening now, very little.
The problem is our polititians and our society bowing down at the altar of the environmentalists!
Until this problem is resolved we will continue to sink deeper and deeper into the mire we are currently experiencing!
If we had began to drill and explore 5 years ago or 10 years ago, we could now be reaping the benefits of that work, but we MUST have some additional refining capacity.
WE MUST have some competition to get the price down and that will only come with increased exploration and refining capacity!
CarlGeo
I couldn't agree more!
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Old 02-26-2012, 02:38 AM   #65
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The green energy solutions areore costly that either hydro, coal powered or nukes. The solar and wind gen units are very high cost maintainance and more costly to install per kilowatt. Up here in Canada the enviromentalists fight every hydro and nuke plan yet expect us to pay more for their idea of green energy. I really dislike fools with agendas.
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Old 02-26-2012, 08:15 AM   #66
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Originally Posted by CarlGeo View Post
It is truly a supply and demand problem. When did anyone in the USA build a refinery? Not in recent years, but how many autos, and truck have been added within our society? Many!
How much exploration and development of oil fields has occured or is happening now, very little.
Would be nice if it was that simple, but it's not a domestic market. The USA currently EXPORTS more refined fuel than any other commodity. It's our #1 export. Clearly not a case of demand outpacing supply.

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Originally Posted by CarlGeo View Post
The problem is our polititians and our society bowing down at the altar of the environmentalists!
Until this problem is resolved we will continue to sink deeper and deeper into the mire we are currently experiencing!
If we had began to drill and explore 5 years ago or 10 years ago, we could now be reaping the benefits of that work, but we MUST have some additional refining capacity.
If this were purely a domestic market, we would have far more refining capacity than we need. We only have 2% of the world's oil supply. We cannot drill/pump enough to overcome the big players (Russia and OPEC) and affect prices. Plus, they are cartels, not competitors. They're not interested in competing with each other, they want to control the price. As long as they can turn back their spigot enough to cause world-wide production to fall below world-wide demand, they will have this power.

Unfortunately, there is no motivation for any oil well owner to create this kind of situation. Oil never spoils. It sits in the ground until the well owner likes the market. Then he pumps some out, and sells it. It is in every oil well owner's best interest to keep the market just like it is.

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WE MUST have some competition to get the price down and that will only come with increased exploration and refining capacity!
Cartels are anti-competitive. They don't compete, they conspire to throttle production to keep the price high. Domestic producers are piggybacking on the cartels manipulation of the market. They want to sell their oil at higher prices too.

Unless somebody gets into the oil business in a not-for-profit way, and can pump enough oil into the market to cause the world-wide supply to outpace demand, prices will remain high. I don't believe that will happen, because a) We don't have the supply, and b) Even if we did, no one will step up and operate a break-even business to make it happen.
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Old 02-26-2012, 08:47 AM   #67
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I've stated this somewhere before, but here it is again.

Remember 1974? We had an "oil shortage." (NOT)

Remember getting in lines to get gas?

Remember "Odd Days/Even Days," where you got fuel on Odd or Even days depending on the last number in you license plate?

Remember only being able to purchase gas if you were below the 1/2 tank mark, and the service station owner check it. Remember those days?

We did not have an oil shortage. My corner gas station, who I did business with all the time, told me not to worry, that I could have fuel any time I wanted fuel. He stated he could get as much fuel as he wanted. So where was the shortage.

Remember "Carpooling?" Remember the media broadcasts on this situation "asking" people to car pool so the supply would go up, and demand would go down.

Remember the shortage being short lived because people really did carpool and all of a sudden it was announced that there was no longer a shortage.

Where is that type of media and public cooperation today?

"I have met the enemy, and he is us."
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Old 02-26-2012, 08:52 AM   #68
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Originally Posted by Wayne M
I've stated this somewhere before, but here it is again.

Remember 1974? We had an "oil shortage." (NOT)

Remember getting in lines to get gas?

Remember "Odd Days/Even Days," where you got fuel on Odd or Even days depending on the last number in you license plate?

Remember only being able to purchase gas if you were below the 1/2 tank mark, and the service station owner check it. Remember those days?

We did not have an oil shortage. My corner gas station, who I did business with all the time, told me not to worry, that I could have fuel any time I wanted fuel. He stated he could get as much fuel as he wanted. So where was the shortage.

Remember "Carpooling?" Remember the media broadcasts on this situation "asking" people to car pool so the supply would go up, and demand would go down.

Remember the shortage being short lived because people really did carpool and all of a sudden it was announced that there was no longer a shortage.

Where is that type of media and public cooperation today?

"I have met the enemy, and he is us."
I remember it well. I had two cars. One had an odd plate and the other had an even one. I was a salesman and had a salesman's exemption, however I had to wait in lines for 2 hours each day. No fun.
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Old 02-26-2012, 08:54 AM   #69
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During the `74 "shortage", my brother and I flew near the tank farm west of Phx. At the time, the tanks had "floating" tops and you could tell how full they were. Almost all of them were at least 3/4th full.
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Old 02-26-2012, 08:57 AM   #70
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During the `74 "shortage", my brother and I flew near the tank farm west of Phx. At the time, the tanks had "floating" tops and you could tell how full they were. Almost all of them were at least 3/4th full.
There were tankers as far as the eye could see off of NY Harbor anchored full of fuel waiting for the price to go up.
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