More than 30 years since the oil embargo, we are still OPEC's bitch

[MajorUrsa]

Quote from ZZZzzzzzzz:


Decrying near-record high gasoline prices, the House voted Tuesday to allow the government to sue OPEC over oil production quotas.

What does this mean? How can anyone sue OPEC? What legal platform and what penalties? Who's the judge? Is there any substance in this, or just windowdressing?

Anyway, sounds a bit like a drug-addict trying to sue his snow-supplier for tightening supply and raising prices. Long before court is reached the addict begs for snow and for his supplier to come back, please please.

Ursa..

 

[Dr. Zhivodka]

You're a good man Pabst. However, you would have sucked as a politician.. You fight your nature which is quick and pragmatic...like a trader. Politicians/Partisans are slow, dumb, weak and dogmatic. They’re joiners. They’re parasites. Not libertarian free thinkers.

Quote from Pa(b)st Prime:

Touche'. In a big way. Per usual.....

 

[Dr. Zhivodka]

Of course...either you participate or you don't or you whine about it. Big Oil is not really the thing but Oil Sevice Shares have been..

I trade OIH, NE, RIG, TDW, DO, CAM (among many other things) almost everyday...they've been an ATM lately.

Quote from CaptainObvious:

The only way to offset the price at the pump is to be an investor in big oil, and then short the pricks when times get tough for them. Other than that, they hold all the cards.

 

[thriftybob]

As global demand rises, and existing fields deplete, it would make sense that the people selling exploration and drilling stuff would be the biggest benefactors.

It won't stop till economies contract to where demand no longer exceeds supply because the politicians lack the guts to tell people the truth or do anything about it until its too late.

 

[deviltrader]

Quote from CaptainObvious:

Exxon alone made nearly 400 billion in profits last year. A new refinery in todays dollars would cost about 5-7 billion. In other words, about a weeks profit.

Check your figures. No company on the face of the earth made $400B in profits in 2006. XOM had $36B net income in fy2006.

 

[deviltrader]

Quote from thriftybob:

The only thing that would really solve it would be to reduce demand to where its a demand constrained buyer's market instead of a supply constrained sellers market.

Reducing demand won't work. Oil companies and countries would just reduce output to keep supply & demand in balance.

 

[thriftybob]

Naaaa, they need revenue.

It wasn't so long ago that oil was $10/barrel. If they had kept supply limited it would never have gone that low.

 

[Vinny1]

Quote from CaptainObvious:

There is not, nor has there ever been a shortage of oil. There is a shortage of refining capacity. This is intentional. Big oil has used environmentalists as useful idiots/scapegoats for 30+ years. Truth is, they(big oil), have no interest in building more refineries. Less capacity = more profits. Simple!
Exxon alone made nearly 400 billion in profits last year. A new refinery in todays dollars would cost about 5-7 billion. In other words, about a weeks profit. Instead they used the bulk of their profits buying back stock and paying dividends to shareholders.
The only way to offset the price at the pump is to be an investor in big oil, and then short the pricks when times get tough for them. Other than that, they hold all the cards.

They made 39.5 billion in profits last year...

http://finance.yahoo.com/q/is?s=XOM&annual

 

[CaptainObvious]

Quote from deviltrader:

Check your figures. No company on the face of the earth made $400B in profits in 2006. XOM had $36B net income in fy2006.

My bad, the fat finger strikes again. Other than that, I still stick with the premise of my original post.

 

[AAAintheBeltway]

Quote from thriftybob:

The only thing that would really solve it would be to reduce demand to where its a demand constrained buyer's market instead of a supply constrained sellers market.

The way to kill 3 birds with 1 stone was to tax fuel usage, use the money to eliminate the budget deficit, and reduce the trade deficit as a consequence. Of course the reduction in demand would also force the price of the oil itself lower, too.

Another way to do it instead of a tax is simply to allow the world to go into recession or depression. That method has been very effective, every time its been used. People without jobs and without money don't buy a lot of fuel. Its a shame that this method is a lot more painful than a fuel tax would be.

We proved we learned absolutely nothing in 30 years, IMO.

Since congress is in a panic over $3.00 regular, just how high would you make that tax? I actually agree that, economically, it makes sense. Real world, it will never happen, and if it did, don;t count on them using that extra money to pay off the deficit. Not when they can spend it instead. All those Z visa holders' poor relatives are going to need a lot of taking care of.

I think a far simpler solution would be to steal Iraq's oil and use it instead. It really wouldn't be stealing, since they owe us big time. When we drain that, we can go to Saudi Arabia. They have enough to last a couple hundred years. Problem solved.