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FF_Canuck





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PostPosted: Tue May 27, 2008 12:42 am    Post subject: 'Big Oil': Not actually all that big... Reply with quote

As the price at the pumps rise, the usual suspects are blaming Big Oil and their evil desire for profits. I suppose it isn't news that anti-corporatism is alive and well, but I found this little tidbit rather suprising:

National Oil Companies Control 94% of the World's Reserves

John @ Powerline wrote:
With 94% of the world's oil supply locked up by foreign governments, most of which are hostile to [North America], the relatively puny American oil companies do not have access to enough crude oil to significantly affect the market and help bring prices down. Thus, Exxon Mobil, a small oil company, buys 90% of the crude oil that it refines for the [domestic] from the big players, i.e, mostly-hostile foreign governments. The price at the [pump] is rising because the price the big oil companies charge Exxon Mobil and the other small [North American] companies for crude oil is going up.


Clearly the answer to this problem is a Carbon tax and NEP II...
kwlafayette





Joined: 03 Sep 2006
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PostPosted: Tue May 27, 2008 10:47 am    Post subject: Reply with quote

Yeah, well, if you want people to use less, it has to cost more. "Revenue neutrality" aside. Also, the central lynch pin of Kyoto was shipping our wealth overseas, and this seems to be accomplishing that objective.
gc





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PostPosted: Tue May 27, 2008 11:05 am    Post subject: Reply with quote

Exxon Mobil can charge what it wants for oil...but with the largest profit of any company in history, let's not pretend that they are not to blame for high oil prices.
kwlafayette





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PostPosted: Tue May 27, 2008 3:31 pm    Post subject: Reply with quote

Wow, that one really sailed over your head didn't it? Exxon does sell much oil, they are the ones buying it.
Craig
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PostPosted: Tue May 27, 2008 9:13 pm    Post subject: Reply with quote

kwlafayette wrote:
Wow, that one really sailed over your head didn't it? Exxon does sell much oil, they are the ones buying it.


Actually - they do sell oil. They buy it, process it, and sell it in many forms including oil. I support the oil companies, but your statement is not accurate.
kwlafayette





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PostPosted: Wed May 28, 2008 9:54 am    Post subject: Reply with quote

My statement is entirely accurate. Further more it is precise. When you talk of the price of oil, it is generally and widely understood that you are talking about the price of a barrel of light sweet crude oil on the international commodity market; not bunker C, not heating oil, not sour gas, not bitumen, but a barrel of light sweet crude. Crude oil is bought, and refined into products such as heating oil, diesel, and gasoline. 10w30, all the stuff Exxon or Shell sells is refined product, the price of which will be based on several factors including the price of crude, refining costs, and profit margins.

http://www.washingtonpost.com/.....00861.html
gc





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PostPosted: Wed May 28, 2008 11:28 am    Post subject: Reply with quote

From the article:
Quote:
The price at the U.S. pump is rising because the price the big oil companies charge Exxon Mobil and the other small American companies for crude oil is going up.

Most consumers don't buy "barrels of light sweet crude", they buy the refined products . The price of those refined products is set by companies like Exxon, so the article is inaccurate.
kwlafayette





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PostPosted: Wed May 28, 2008 6:59 pm    Post subject: Reply with quote

gc wrote:
Most consumers don't buy "barrels of light sweet crude", they buy the refined products . The price of those refined products is set by companies like Exxon, so the article is inaccurate.
The price of petro-chemical products like gasoline is set on international commodity markets, just like the price of steel, corn, and cotton. No one person, company, or group of companies has control over the price. Exxon could unilaterally raise the price of all their goods, but that does not mean Petro-can will, or BP, or anybody else.

In fact, gasoline pricing is the most competitive thing the world has ever seen. The market reacts to price changes as small as a tenth of a cent, look down almost any street, and you will see the local price in big brightly lit numbers 10 feet off the ground. It is not only consumers watching this price, your competitors are too; no telling people that you do not give prices over the phone. Any sale you want to have, your competitor knows about it within seconds, and he is matching your price.

If you want to know what you will be paying for gasoline in 10 months, all you have to do is buy a big tank, and buy some gasoline futures. Get however many thousands of liters you want for December, January, or February delivery.
gc





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PostPosted: Wed May 28, 2008 7:48 pm    Post subject: Reply with quote

kwlafayette wrote:
The price of petro-chemical products like gasoline is set on international commodity markets, just like the price of steel, corn, and cotton. No one person, company, or group of companies has control over the price.

Exactly, the price is set by companies such as Exxon.
Quote:
Exxon could unilaterally raise the price of all their goods, but that does not mean Petro-can will, or BP, or anybody else.

Nothing is stopping them from unilaterally lowering the price of their goods, but then they wouldn't make as much profit.
Sheila





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PostPosted: Thu May 29, 2008 9:30 am    Post subject: Reply with quote

Currently the world's demand for oil is greater than the supply. Exxon or any other company can and will charge whatever they like. It's only going to get worse.
kwlafayette





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PostPosted: Fri May 30, 2008 11:35 am    Post subject: Reply with quote

Have you considered that talk of carbon taxes, cap and trade, stuff like that, have contributed significantly in the run up of the price of oil? Just curious. The oil market has always been prone to panic at the slightest rumor. When some of the top consuming nations talk about new taxes, making oil production more expensive, you don't think that has an effect?
Sheila





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PostPosted: Fri May 30, 2008 1:34 pm    Post subject: Reply with quote

Oil is a part of your everyday life. Look around you and see all the plastic? By-products of oil are in your shampoo, soaps, aspirin (yeah that's what I thought). The reason the price of our oil is going up is because of consumer demand. And it's not just about SUV's.
The reason oil production is so expensive is because we are on the downside of the boom. It's costlier to extract what's left. I have no doubt they will find Saskatchewan Oil Sands, but at what cost? This is truly what drives the price of oil (in my humble opinion, :) )
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