You got any idea how much it costs to drill an oil well?
Or the technology and expense involved to get that oil out of the ground, to and through a refinery, and delivered to the pump?
Adjusting for inflation gas is still cheaper than it was during the 70's oil "crisis" when we imported far less than we do now.
I want cheap and plentiful fuel as much as the next person, but to blame this on the "big fat oil companies" is a bit mis-guided, in my very humble opinion of course.
The reason we are at the mercy of OPEC and other oil producing nations is that we have decimated our domestic ability to produce and store the lifeblood of our nation. This didn't occur overnight and won't be "fixed" over night either.
Nobody wants a refinery or tank farm in "their" backyard, too unsightly an dangerous, nor do they want drilling on government land. Can't drill in remote Alaska, nor off the coast of California, refineries are shut down because they can't meet EPA requirements, pipelines aren't being replaced due to the huge amount of capital investment required, and so on.
Our domestic energy policy is kaput. Therefore, we must import our oil from Canada, Mexico, and Venezuela. We get very little from the Middle East. Most of that goes to Japan, which has no oil, and Europe.
Desert Storm wasn't fought for us, but to stabilize the rest of the world's supply.
I watched Bill Richardson today and wanted to laugh. 30 million barrels??? Whoop-tee-doo! We consume 20 million a day here. Boy, that ought to really make things better.
Like I've said before, the largest amount of storage capacity we have is in the tanks of our vehicles. The reason the inventories in heating oil are so low, most refineries can only make only one product at a time, within reason. They need to switch processes to gear up production for whatever is needed next, due to the fact there is not enough storage capacity.
People are driving around filled up instead of empty, just in case the price goes up, therefore putting pressure on refineries to produce more gasoline to meet the demand. So the perception creates a self-fulfilling prophecy.
As for the speculators in the market, the principles of a free market will eventually win.
Because INTC missed by a bit, is that reason for it to lose 90 billion +/- in marketcap? Or what fundamental reason is there for CMRC to have gained a billion +/- in marketcap today? Pure speculation.
Now they want to cash in before it all ends.
Is this any different for some two-bit company to pump their stock up to outrageous levels and then dump a secondary offering on an unsuspecting market? Not really, except for the fact the oil company needs its money to search for and produce a commodity that we all depend on.
Actions have consequences. And the actions toward the domestic oil industry have forced them to explore/produce oil in some third world country, that then has the power to make us get on our knees and beg.
It is not a pretty sight..... |
