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pumpjack
Coal
Joined: Jul 06, 2008
Posts: 4
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 Posted: Sun Jul 06, 2008 2:18 pm Post subject: What happens in America, stays in America? |
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Is it true that all oil produced in America goes on the international market and is sold to the American consumer at prices set by OPEC?
If it's true that all oil goes into one big collective international pot, it would seem that Democrats are right -- maybe more U.S. drilling wouldn't lower the price of gasoline at the pump? |
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Bas
Moderator
Joined: Mar 26, 2005
Posts: 3784
Location: over here
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| Posted: Sun Jul 06, 2008 2:32 pm Post subject: Re: What happens in America, stays in America? |
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The prices are set at the world market, not by Opec. But America gives away it's oil at huge discounts to the big oil companies.
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"The best thing about the future is that it comes only one day at a time."
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TreeFarmer
Heavy Crude
Joined: Jun 26, 2007
Posts: 326
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| Posted: Sun Jul 06, 2008 2:40 pm Post subject: Re: What happens in America, stays in America? |
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| Bas wrote: | | But America gives away it's oil at huge discounts to the big oil companies. |
We do? Please provide a couple of links for my viewing please.
Thanks;
TF |
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pumpjack
Coal
Joined: Jul 06, 2008
Posts: 4
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| Posted: Sun Jul 06, 2008 2:50 pm Post subject: Re: What happens in America, stays in America? |
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| Bas wrote: | | The prices are set at the world market, not by Opec. But America gives away it's oil at huge discounts to the big oil companies. |
... but, but, big oil companies and independent co-ops are the ones that are doing the drilling. |
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albente
Light Sweet Crude
Joined: Aug 20, 2004
Posts: 1356
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| Posted: Sun Jul 06, 2008 3:19 pm Post subject: Re: What happens in America, stays in America? |
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| pumpjack wrote: | Is it true that all oil produced in America goes on the international market and is sold to the American consumer at prices set by OPEC?
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"Wocka Wocka Wocka"
Ever since the First Oil Crisis, the US lost the privilege of oil independence. So welcome to the party, no matter if you're a bit of a latecommer.
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Tyler_JC
Moderator
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Joined: Sep 25, 2004
Posts: 4543
Location: Boston, MA
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| Posted: Sun Jul 06, 2008 4:26 pm Post subject: Re: What happens in America, stays in America? |
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| pumpjack wrote: | Is it true that all oil produced in America goes on the international market and is sold to the American consumer at prices set by OPEC?
If it's true that all oil goes into one big collective international pot, it would seem that Democrats are right -- maybe more U.S. drilling wouldn't lower the price of gasoline at the pump? |
The prices are not set by OPEC. They are set by The Market.
More supply would mean lower prices.
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"www.peakoil.com is the Myspace of the Apocalypse." |
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emailking
Intermediate Crude
Joined: Mar 11, 2006
Posts: 749
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| Posted: Sun Jul 06, 2008 8:57 pm Post subject: Re: What happens in America, stays in America? |
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| The market does not "set" the price of oil. The sellers of the oil set the price. OPEC sets the price of the oil it produces and sells. OPEC has to set its prices accordingly if it wants to both sell its oil and avoid shortages. The "market" is just what all this amounts to. |
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pstarr
Expert
Joined: Sep 27, 2004
Posts: 7089
Location: Behind the Redwood Curtain
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| Posted: Sun Jul 06, 2008 9:39 pm Post subject: Re: What happens in America, stays in America? |
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| emailking wrote: | | The market does not "set" the price of oil. The sellers of the oil set the price. OPEC sets the price of the oil it produces and sells. OPEC has to set its prices accordingly if it wants to both sell its oil and avoid shortages. The "market" is just what all this amounts to. |
I am not a 'proponent' of the market but products ARE sold to bidders by sellers and this relationship could be defined as a market. If the prices set by OPEC are too high then people conserve and the price goes down.
I think the market is a fair description of this dynamic. Don't you?
given that, what you said pumpjack "Democrats are right -- maybe more U.S. drilling wouldn't lower the price of gasoline at the pump?" does not ring true. Any additional supply would tend to suppress prices------unless the additional supply is hard to find, difficult to produce, low-eroei crude. Then the prices continues to climb and . . . . THAT'S PEAK OIL
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Peepers
Heavy Crude
Joined: Jan 01, 2005
Posts: 213
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| Posted: Sun Jul 06, 2008 9:45 pm Post subject: Re: What happens in America, stays in America? |
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| pumpjack wrote: | | ... but, but, big oil companies and independent co-ops are the ones that are doing the drilling. |
Stockholder-owned oil companies like ExxonMobil, BP, Shell, Chevron, Kerr-McGree, Haliburton and others own and/or drill just one-fourth of the world's oil reserves. The rest are owned and drilled by state-run oil companies. But their exports still must be sold on the world market. If there are more buyers than sellers of the oil the price goes up. Shortages also occur -- as is happening in much of the Third World which can't afford to buy as much oil at these rising market prices. |
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emailking
Intermediate Crude
Joined: Mar 11, 2006
Posts: 749
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| Posted: Sun Jul 06, 2008 9:52 pm Post subject: Re: What happens in America, stays in America? |
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| pstarr wrote: | I am not a 'proponent' of the market but products ARE sold to bidders by sellers and this relationship could be defined as a market. If the prices set by OPEC are too high then people conserve and the price goes down.
I think the market is a fair description of this dynamic. Don't you?
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Yes I would agree with that. But if the claim is that the prices are not set by OPEC and are set by the "market" instead, well that's just wrong. OPEC sets the prices for their own oil. |
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Kingcoal
Expert
Joined: Sep 29, 2004
Posts: 2330
Location: Pennsylvania, USA
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| Posted: Mon Jul 07, 2008 8:16 am Post subject: Re: What happens in America, stays in America? |
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Oil is priced as high as someone is willing to pay - just like most things in a free market. I don't think that the house that sold accross the street was worth what it sold for, I wouldn't have paid that much, but someone else did. In the words of a realtor I argued with one time; "it's worth exactly how much someone is willing to pay." When demand matches or exceeds supply, the price goes up expotentially. If oil goes out of style tommorow, the price will plumet. The reason why fresh water is much cheaper is because where I live, supply far exceeds demand. Simple economics.
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"That's the problem with mercy, kid... It just ain't professional" - Fast Eddie, The Color of Money |
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Specop_007
Expert
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Joined: Aug 12, 2004
Posts: 6235
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| Posted: Mon Jul 07, 2008 9:51 am Post subject: Re: What happens in America, stays in America? |
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The only way drilling American fields will noticably lower prices is if we nationalize the industry.
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"Battle not with monsters, lest ye become a monster, and if you gaze into the
Abyss, the Abyss gazes also into you."
Ammo at a gunfight is like bubblegum in grade school: If you havent brought enough for everyone, you're in trouble
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emersonbiggins
Moderator
Joined: Jul 10, 2005
Posts: 5078
Location: Dallas
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| Posted: Mon Jul 07, 2008 10:12 am Post subject: Re: What happens in America, stays in America? |
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| Specop_007 wrote: | | The only way drilling American fields will noticably lower prices is if we nationalize the industry. |
Get the ration cards out... 
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"It's called the American Dream because you'd have to be asleep to believe it."
George Carlin |
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burtonridr
Intermediate Crude
Joined: Aug 03, 2007
Posts: 763
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| Posted: Mon Jul 07, 2008 10:18 am Post subject: Re: What happens in America, stays in America? |
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| Specop_007 wrote: | | The only way drilling American fields will noticably lower prices is if we nationalize the industry. |
+1
I wouldnt mind oil rationing, I think it would be just what we need to curb our outlandish demand....
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cat
Tar Sands
Joined: May 09, 2005
Posts: 97
Location: Western Washington
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| Posted: Mon Jul 07, 2008 11:29 am Post subject: Re: What happens in America, stays in America? |
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| Quote: | | But America gives away it's oil at huge discounts to the big oil companies. |
Is this due to tax breaks and land give aways or are they subsidized in other ways as well? |
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