Post by Monkey ClumpsPost by gringoPost by Monkey ClumpsPost by gringoPost by Monkey ClumpsPost by Bob EldPost by Monkey ClumpsThat's not really the sort of thing you can get a CITE for since oil
companies are private. However, common sense suggests that if they
had access to large finds on areas they already lease, they would be
putting them into production now. Oil companies aren't fools. They
are very good at their business and their business is finding oil and
extracting it. The simple fact is this, if we want to increase
domestic production we need need to allow more area to be explored and
put into production. The democrats needs need to cut the obfuscation
and decide whether they are for increasing domestic production or
against it. If they are against it they should own up to the fact and
face the American public.
Snip....
Yes well, that sums up one of the major problems doesn't it? Oil companies
are PRIVATE companies dealing in a very public national resource. One we
apparently know little about according to you. Furthermore, their end
products are commodities that are necessities. The idea that they are
altruistic benign entities always operating in the public interest is
absurd.
So what are you suggesting, that oil companies should be
nationalized? That has been happening actually. Look at Venezuela.
The nationalized, kicked the private companies out and are now in the
process of running their industry into the ground through gross
incompetence. Private companies have always been far more efficient
than government companies.
that is their rant. Not true.
You sound like the kind of guy who thinks the Soviets won the cold
war.
we the working class sure as hell didn't win anything there. While the
soviets were a threat...able to stir up the poor folk who break their
backs planting crops on mountainsides for wealthy foreign masters,
capitalists had to rein in their greed, and at least give lip service to
taking care of the people who perform all the labor.
Oh shit, it sounds like "gringo" is a usenet Marxist.
Post by gringoPost by Monkey ClumpsPost by gringoPost by Monkey ClumpsPost by Bob EldFurthermore it is absurd to believe that they will just drill for more oil
to make more money, when in fact, the opposite is true. It is in their
interest to keep supplies tight and that's exactly what they are doing. It's
economics 101.
Maybe with a monopoly, which the oil industry hardly is. In an open
market rising prices tend to cause supply to increase. That's how the
system self-regulates. When prices are high there is an incentive to
sell. Haven't you heard sell high, buy low? With oil prices at an
all-time high, every oil company wants to sell as much oil as they can
suck out of the ground. That's economics 101.
You've got it only half right. As there is a finite supply of oil,
there is a finite demand.
This shows you have no understanding of supply and demand. Demand is
not finite and fixed. If price drops demand will increase (people
drive more, fly more, buy bigger less fuel efficient cars etc.)
Of course it is. When one's appetite is sated, one refuses a third
helping of roast beef. Commonsense.
You may be sated but the fat fuck next to you is happy to have thirds
and fourths. And he's going to be telling his fat friends about the
cheap dinner, so you will be seeing more of them. Demand fluctuates.
Its not fixed and there is no ceiling to it.
Post by gringoDemand for oil in Europe has dropped precipitously due to the price
increases; China's demand this year was expected to rise 5.5%; it has
risen so far only 7/10 of 1%.
Post by Monkey ClumpsPost by gringoIf OPEC upped production, if a magic wand
were waved forcing our oil companies to start pumping from their
thousands of capped wells, demand would increase minutely and the price
would go down down down.
Well yes and most people expect that prices will eventually go down,
but probably not to any level close to what it was a few years ago.
Nevertheless, oil companies have a huge incentive to bring more oil to
market right now. They want to sell with the price high.
nonsense. "Most people" do not expect that prices will eventually go
down. Experts are telling us just the opposite. That we can expect
$200 per barrel before the year ends.
They will lower the prices a bit, however. When the get them well above
what will incite riots around the world and demands to nationalize and
otherwise punish the greedy bastards, they will back off a bit, and stay
there for another decade or so. But it will not drop below, say, $100
per--double what world demand says it ought to be.
Tell me, where do they have the secret meeting where they determine
global oil prices? Is that during a skull & bones meeting with Dick
Cheney presiding? I'd love to learn more about your fascinating
conspiracy theories.
Post by gringoPost by Monkey ClumpsPost by gringoIn a related aside, a bevy of economists reported on CSPAN the other day
that Bush's appointee to the FED caused the current situation when he
clued the world in advance that he was about to lower the FED interest
rates, thereby lowering the value of our dollar.
Yeah lots of people have been complaining that the Fed has not
supported the dollar. Do you have any more irrelevant facts to add?
why is the value of our dollar irrelevant to anything we buy in the US?
Who said it was? Its irrelevant to this discussion about oil
drilling.
Post by gringoPost by Monkey ClumpsPost by gringoPost by Monkey ClumpsPost by Bob EldWhy would any company want to increase supply when the MONEY
is in doing the opposite?
Dude, do you understand how markets work? You seem very confused.
You could stand to take a few lessons from him. His understanding of
world economics is light years beyond yours.
Its pretty clear that you are in no position to judge. You sound at
least as clueless as Bob.
that you would say that in the face of Bob's proven superior knowledge
demonstrates your own ignorance.
Dude the only thing thats been proven is that you are a conspiracy-
theory toting usenet marxist with an axe to grind with anything
resembling capitalism and an extremely weak grasp of how markets
work.
Post by gringoPost by Monkey ClumpsPost by gringoPost by Monkey ClumpsPost by Bob EldExxon made more money last year that any
corporation in HISTORY. Why the hell would they want to change that? "Oil
companies aren't fools" You said it! No, but we the people are.
Let me try to explain this to you in the simplest terms possible.
High prices are a massive incentive for Exxon to produce and sell as
much oil as they possibly can *right now*.
Let me try to explain this to you in the simplest terms possible. Exxon
and the other pirates are already meeting the demand.
Demand varies with the price point you clod.
to a minute degree, doofus. your argument implies that if the price
drops a few cents we suddenly
feel empowered to drive the long way to work.
Demand is always going to be "met" fool. If supplies can't go up due
to scarcity, then the price goes up until demand is lowered to match
supply. Conversely, if supply is suddenly increased, then the price
drops until demand has increased to match supply. Your view of demand
as some sort of fixed number demonstrates your ignorance.
Post by gringoPost by Monkey ClumpsPost by gringoDumping any more
oil on the market would in fact lower the demand--and the prices.
No shit sherlock. It is still in each oil company's best interest to
bring as much of their product to market now to take advantage of the
high prices. Will that increase supply and eventually lower prices?
Yes, thats how markets work you dolt. But, individual companies
aren't going to hold back to keep prices high.
sonny, to this point I've talked to you as if you are an adult. I've
refuted your points without attacking you personally. Okay, you're not
adult. fine. Let's play in the mud, monkey.
In a true free market, your latter point would be true. The oil market
is not a free open market. It is controlled by 3-4 huge companies (who
undoubtedly own huge blocks of one another's stock) working in tandem
with a few oil-producing countries.
So this is what it boils down to. Your assertion that oil is not a
true market commodity but rather the price is fixed by a handful of
large companies and countries. Thats a bold assertion my friend. One
with no evidence to back it up (I have trouble imagining the CEO of
Exxon meeting with Chavez, the Iranians and the Russians to discuss
pricing, but that's just me). Do you want to provide some cites or
should we just take your word on it?
Post by gringoPost by Monkey ClumpsPost by gringoPost by Monkey ClumpsExxon doesn't control oil
prices. Its not even close. The Saudis try to but even they don't
have enough market share. Since Exxon doesn't control the price, they
want to max out production and sales when the price is at $140 not
years down the road where thing may have settled and the price might
be $50.
pure propaganda. The oil companies are not American; they are
international, they are corporate and therefore their "patriotism" is to
their profits. They sell everywhere, including to China.
If they maxed out production they would exceed current demand, and the
price--and profits--would drop.
Your idea of demand as a fixed number shows your lack of understanding
of basic economic concepts. Demand moves with price. Nevertheless, you
are correct that as supply increases, prices will tend to drop. What
you don't comprehend is that individual players will always act in
*their* best interest, which is to sell as much as possible with
prices high. How do you think oil prices dropped below $20 in the
90s? Oil producers were going bust, do you think they wanted that to
happen? If the whole industry colludes to inflate prices as you
propose, how did that ever happen?
Your comments ably demonstrate your unwillingness to consider any fact
that contradicts the conservative Party line. Commonsense is all it
takes to understand what is going on.
OPEC was getting what it wanted, wasn't it. Clinton wouldn't play the
games they wanted, so they kept on our good side till the Saudis
business partners bush and cheney took control.
Do you seriously believe that demand has increased 600% in a decade????
You never answered my question. If the oil industry colludes and
fixes the price, why did they let the price get so low in the
nineties? Don't have an answer? Let me help you. Your make-believe
collusion is just a bunch of Marxist bullshit.
Post by gringoPost by Monkey ClumpsThe reason prices are high now is that the oil simply is not available
to put on the market. That is why new sources must be opened up or
this situation will just keep getting worse. The fact that the US
government prohibits offshore drilling for a large portion of our
coast and the frozen wasteland known as ANWR is asinine. We are now
reaping the rewards of that foolish policy. Idiots like you blame the
oil companies. The real blame goes to politicians and environmental
lobbyists who block drilling.
stop shining, monkey. I've already related the facts concerning this
drilling. Back up a few posts and reread. Here's a hint: 68,000 leased
and permitted acres in proven oil fields in which to drill.
Which probably don't have significant deposits, or they can't be
produced economically.
Your argument is that the current leases hold all the oil we need and
oil companies are sitting on it just to push the price of oil up
higher? Sorry gringo thats just a bunch of left-wing nonsense and no
one with a brain is going to buy it. Take a hike.
Post by gringoIdiots like you always lick the privates of those who are slinking up to
your bare backsides.
I'll ask you not to project your sick fantasies on the rest of us.
Post by gringoPost by Monkey ClumpsPost by gringoPost by Monkey ClumpsPost by Bob EldMaybe it's time to revisit our anti trust legislation of the 1910's. Maybe
it's time to break up the vertical integration in the oil business and allow
more competition in the business. Maybe it's time to manage our NATIONAL
resources as though they belonged to the public and not to Exxon. Maybe its
time to look at petroleum supply and fuel as a public utility.
Oh geez. We're facing an energy crisis that requires innovation and
efficiency to get through and you suggest we solve the problem with
socialism and government intervention, a guaranteed destroyer of
innovation and efficiency. Sounds like a brilliant plan. *roll eyes*
I'll remind you that it was government working with private enterprise
(universities) that developed the internet. That most of the scientific
advances during the past 50 years came about through government funding
(NASA, etc). That universities and NIH laboratories discovered most of
the miracle drugs now being sold for exorbitant profits by private
pharmaceutical companies.
And this is relevant how?
Plainly relevant to the comment I was referring to, to anyone of average
intelligence.
Repeated once again for your perusal.
Gringo, your whole argument boils down to this: There is collusion
in the global oil industry. They are fixing prices. Oil companies
don't need access to more area because they have all the oil we need
within their current leases, but they are purposely sitting on it to
prop up prices. Thats a bunch of left-wing conspiracy theory bullshit
that might fly with your Marxist friends but it ain't gonna fly here
unless you come up with some really good cites. So come up with the
cites or hit the highway, gringo.
I m a pragmatic Liberal who understands life as it is.
Ask and ye shall receive, Monkey Chump.
First cite:
http://www.usdoj.gov/opa/pr/1997/July97/299at.htm
FOR IMMEDIATE RELEASE AT
FRIDAY, JULY 18, 1997 (202) 616-2771
TDD (202) 514-1888
JUSTICE DEPARTMENT ACTS TO STOP COLLUSION AMONG THREE OIL TRADERS
Settlement will Keep Firms from Exchanging Broker
Commission Information
WASHINGTON, D.C. -- The Department of Justice reached a
settlement today with three major oil trading firms that will
prohibit the companies from exchanging broker commission
information involving contracts for Brent blend crude oil--a
crude oil produced in the North Sea.
The three colluding firms--AIG Trading Corporation, BP
Exploration & Oil Inc. and Cargill International S.A.--discussed
the information in order to lower the commissions they paid to
brokers in the U.S. for these contracts, the Department said.
As a result of today's settlement, the firms will no longer
be able to conspire to reduce broker commissions.
Joel I. Klein, Acting Assistant Attorney General in charge
of the Department's Antitrust Division, said, "This case
demonstrates the Antitrust Division's continuing commitment to
investigate and prosecute agreements in the financial markets
that violate the antitrust laws."
A Brent spread contract is the simultaneous purchase and
sale of two contracts, for different months forward, for Brent
crude oil. A contract for difference, or CFD, is a commercial
transaction based on the difference between the current published
price for loaded Brent crude oil and the future price for Brent
crude oil to be loaded on an unspecified future date. The
trading firms had been paying separate full commissions to the
brokers for both paired contracts and wanted to reduce the amount
they paid. Broker commissions are paid for arranging the
purchase and sale of Brent spread contracts and contracts for
differences.
The Department's Antitrust Division filed a civil complaint
today against the companies in the U.S. District Court for the
Southern District of New York in Manhattan. At the same time,
the Department filed a proposed settlement that would resolve the
lawsuit if approved by the court.
The complaint alleges that AIG, BP, Cargill and others
conspired from July 1992 through May 1993 to exchange current and
prospective brokerage commission information on Brent spread
contracts and CFDs in order to lower brokerage commissions paid
to brokers in the U.S. Representatives of the companies carried
out the conspiracy by telephone and in meetings in Europe and the
U.S.
Today's settlement prohibits AIG, BP, and Cargill from
agreeing with any other trader to fix, lower, raise, stabilize or
maintain any brokerage commission for Brent spread contracts and
CFDs or exchange any information for these purposes.
The companies will also be prohibited from requesting or
advising other traders to lower, raise or change any brokerage
commissions for Brent spread contracts and CFDs.
AIG Trading Corp. is a subsidiary of AIG Trading Group Inc.,
which is a subsidiary of American International Group Inc.
American International Group and its subsidiaries comprise a
large diversified financial service organization operating in 130
countries and jurisdictions. AIG Trading is headquartered in
Greenwich, Connecticut.
BP Exploration & Oil is headquartered in Cleveland.
Cargill International is headquartered in Geneva, Switzerland.
As required by the Antitrust and Procedures and Penalties
Act, the proposed stipulation and order will be published in the
Federal Register, along with the Department's competitive impact
statement. Any person may submit written comments concerning the
proposed decree during a 60-day comment period to Ralph T.
Giordano, Chief, New York Office, U.S. Department of Justice,
Antitrust Division, 26 Federal Plaza, Room 3630, New York, New
York 10278, 212-264-0390.
At the conclusion of the 60-day comment period, the U.S.
District Court for the Southern District of New York in
Manhattan, may enter the consent decree upon finding it serves
the public's interest.
###
A lesson for you, monkey.
Like all other meat sources, the cow is not consumed the moment she is
killed. Upon birth, she is husbanded by the rancher till she is grown.
When there is a place for her in the food pipeline--and the prices are
right--the lowly cow is shipped off to a feedlot, there to be fed all
she will eat to fatten her up and increase her value. After being
slaughtered, she is hung for weeks in coolers and/or freezers. She may
not be consumed for a year or more after being harvested.
An oil well is drilled, oil is found. It isn't pumped into a waiting
Schneider, monkey. Oil in the ground must first be refined. If the
refinery is already at peak production, the oil must be either left in
the ground (CAPPED) or stored somewhere till needed. Water in the well
in your backyard sleeps peacefully until a faucet releases it for usage.
It doesn't spoil while waiting in the ground or in a storage tank. Oil
in the ground has been in the ground for, oh, a million years or so; it
can remain in the ground for another few years, it will not spoil, it
merely increases in value. Oil in the ground back in the 1930s was worth
a few pennies per gallon: that very same oil is now worth dollars per
gallon! You keep spouting your understanding of economics, why do you
have such a problem comprehending this very basic tenet of economics?
Perhaps if you stop sniffing your ass, Monkey Clump.
A diamond also forms over millennia. DeBeers has a virtual monopoly on
diamond production. It buys them, "refines" them, then stores them
for...millennia. They sell those diamonds at a carefully considered rate
in order to keep their profits astronomically high. Likewise with oil
companies.
#####
http://www.citizen.org/pressroom/release.cfm?ID=1531
On the supply side of the equation, as a result of mergers, the five
largest oil companies operating in the United States _now control 61
percent of the domestic retail gasoline market, 48.5 percent of the
domestic oil refinery market and 50 percent of domestic oil exploration
and production. ExxonMobil, ChevronTexaco, ConocoPhillips, BP and Shell
also control 15 percent of the world's oil production. These top five
corporations now produce more oil everyday than Saudi Arabia, Kuwait and
Yemen combined._
"It is no surprise that gasoline prices are skyrocketing," said Wenonah
Hauter, director of Public Citizen's Critical Mass Energy and
Environment Program. "This is what you get when you have a handful of
mega-corporations dominating the market, and it is what we predicted
when the Federal Trade Commission (FTC) allowed massive consolidation of
the oil industry in 1999 and 2000."
These new mega-corporations are involved in all facets of the oil and
gas industry: exploration, production, refining, transportation and
retail sales. This vertical integration has resulted in a handful of
corporations controlling a substantial chunk of the domestic oil and gas
market, allowing them to artificially inflate prices and take advantage
of any supply disruptions by gouging consumers.
In March 2001, the FTC reached a curious conclusion about high gasoline
prices in the Midwest. While it claimed that no collusion had taken
place under current law, it found that "conscious (but independent)
choices by industry participants" to intentionally withhold supplies
resulted in artificially high prices. The report, however, did not
publicly name the names of the companies it alleged to have inflated
prices, since the FTC considered the information proprietary.
###
Tacit collusion occurs when cartels are illegal or overt collusion is
absent. Put another way, two firms agree to play a certain strategy
without explicitly saying so. This is also known as price leadership, as
firms may stay within the law but still tacitly collude by monitoring
each other's prices and keeping them the same. Usually, this occurs when
a firm emerges to set the general industry price and other firms follow
suit. oligopolists usually try not to engage in price cutting, excessive
advertising or other forms of competition. Thus, there may be unwritten
rules of collusive behavior such as price leadership (tacit collusion).
A price leader will then emerge and sets the general industry price,
with other firms following suit. For example see the case of British
Salt Vs Salt Union (Competition Commission report which concludes price
leadership and a lasting collusive agreement between the two firms).
So, they were definitely doing that since the break-up of Standard Oil.
To stifle criticism of their price setting schemes, they /tacitly/
employ speculators. But it matters not to the oil giants why the price
gets higher, the seller benefits enormously when a large percentage of
his product was drilled and stored decades ago when his production costs
were pennies on the dollar.
--
"Sarah, if the American people had ever known the truth about what we Bushes have done to this nation, we would be chased down in the streets and lynched."
--- George Herbert Walker Bush, in an interview with Sarah McClendon, 1992