[pumpjack]

I found this little tidbit about oil that's so simple even your granddaddy can understand it:


Although every oil producing nation, including the United States, puts all the oil it produces on the open international market and buys it back at prices set by the OPEC-dominated consortium, it is nevertheless important for a nation to produce and sell as much oil as it can. The United States does not produce enough oil to enable its oil industry to sell and make outrageously high profits like other high-producing nations do. Even though Venezuela and Mexico puts all its production on the international market and buys it back at OPEC prices, it nevertheless sells so much oil to the open market at OPEC prices that they can use the excessive profits to lower fuel prices for their citizens. In oil-rich Venezuela gasoline is about 14 cents a gallon and in Mexico about $2.40 a gallon.

If the United States produced and sold all the oil it is capable of producing, it too would see its oil companies drastically lower fuel prices for American consumers. In other words, the more oil a nation produces and sells the more profit its oil companies make and is able to use those profits to lower prices for its own consumers.

Of course, if oil companies had their way, they would keep all the profits, but there is no government on the planet that allows them to do that -- except of course the Arabs, but they have so much oil money they don't mind selling it back to their citizens for a nickel a gallon.

[Cashmere]

He's dead Jim.

Save him Bones.

I'm just a Doctor Jim.

[dorlomin]

I found this little tidbit about oil that's so simple even your granddaddy can understand it:


Although every oil producing nation, including the United States, puts all the oil it produces on the open international market and buys it back at prices set by the OPEC-dominated consortium, it is nevertheless important for a nation to produce and sell as much oil as it can. The United States does not produce enough oil to enable its oil industry to sell and make outrageously high profits like other high-producing nations do. Even though Venezuela and Mexico puts all its production on the international market and buys it back at OPEC prices, it nevertheless sells so much oil to the open market at OPEC prices that they can use the excessive profits to lower fuel prices for their citizens. In oil-rich Venezuela gasoline is about 14 cents a gallon and in Mexico about $2.40 a gallon.

If the United States produced and sold all the oil it is capable of producing, it too would see its oil companies drastically lower fuel prices for American consumers. In other words, the more oil a nation produces and sells the more profit its oil companies make and is able to use those profits to lower prices for its own consumers.

Of course, if oil companies had their way, they would keep all the profits, but there is no government on the planet that allows them to do that -- except of course the Arabs, but they have so much oil money they don't mind selling it back to their citizens for a nickel a gallon.

Start here son

http://en.wikipedia.org/wiki/The_Wealth_of_Nations

[MonteQuest]

I found this little tidbit about oil that's so simple even your granddaddy can understand it:

But not you.

Although every oil producing nation, including the United States, puts all the oil it produces on the open international market and buys it back at prices set by the OPEC-dominated consortium, it is nevertheless important for a nation to produce and sell as much oil as it can.

OPEC doesn't set the price of oil traded on New York, London, and Singapore exchanges...the markets there do.

If the United States produced and sold all the oil it is capable of producing, it too would see its oil companies drastically lower fuel prices for American consumers.

First off, since 2000, oil companies working in the U.S. have doubled the number of wells drilled per year. Although increased drilling has added new oil to the nation's supply, it has not done so fast enough to offset the terminal decline of existing fields.

The USA has been in terminal oil decline since 1971. We are producing all the oil we are capable of producing.

Second: The oil companies do not set the price of oil or gasoline, the market does.

Oil companies no more set the price of oil than a farmer sets the price of corn.

Do some homework before you even try to respond.

[aahala2]

Even though Venezuela and Mexico puts all its production on the international market and buys it back at OPEC prices

Not only does gramps and I understand it, we both also
know it's not true. Essentially every country that use or
produce oil have refineries. To the extent each can, any
local production is refined locally.

The price this oil commands is not the OPEC price, the world
price etc. It depends upon the country's law. A lot of the
big exporters sell oil to their own citizens much cheaper than
the world price and in some cases less than the cost of hiring
the natives to man the gas pump.

[VMarcHart]

Welcome to the site, pumpjack. It's a good place to learn, and as far as I'm concerned, there's no stupid questions or statements.

I found this little tidbit about oil that's so simple even your granddaddy can understand it.

OK, this one was not your best. Whether oil, corn --like Monte said--, band-aids, socks, etc, they're ruled by Supply-Demand.

Here's my corny example: It's 110F on the beach, and you're selling ice cold water. The line is huge. You start with $1 per bottle and increase of $0.10 per customer. Now you're selling for $5 and the line is still long. You continue to increase the price ... and you can't see the end of the line. It's a seller's market. Why would you reduce the price? It's a corny and ridiculously simplified example, but I hope it helps you understand Supply-Demand. Want for prices to go down? Stop buying it.

Please let me know if I can be of further help.

[Peleg]

The time when all of these 'solutions' will prove to be less valuable than the breath used to discuss them is coming soon. The gig is up gentlemen. I bet my life on it, my reputation, everything I have.

I like so many others on this site are faithfully giving warning to anyone who cares to discuss oil so it won't be like nobody eve rheard of peak oil.


Will you bet your life on abiotic oil? How about a windfall profits tax on big oil? How about cellulosic ethanol?

I take time to respond to some of these because I think talking is how you get it out there, but you know it really is mostly a waste of time. This OP poster is probably one of the numerous trolls who keep coming back again and again and again with the same old tired rhetoric. Many of them are probably pre-teen boys whose daddies work for Lehman Brothers.

'Haha ha!' they chuckle 'America always wins in my video games.'

You are right buddy. America has won something, and the big prize is in transit right now. Wait just a little longer. Don't lose hope. The fruit of our way of life is a handsome reward.