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Gold/Mining/Energy : Oil Sands and Related Stocks
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To: Terry Maloney who wrote (13248)10/30/2006 1:24:57 AM
From: whitepine  Read Replies (2) of 25575
 
Yo, Terry,

So give me an economic lesson.

Oil IS a homogeneous commodity. It is not unique product that easily allows an owner to act as a price-setter.

Ownership of a minority stake in a commodity does not give the owner the power to excercise price discrimination. Or, by simple comparison, if you owned South Dakota, could you set the international or domestic price of wheat?

Of course not. That is why OPEC exists and why its policies can fail. The Saudi's can't control prices by edict. They need to conspire with other members of the cartel to enforce collusive discipline. Even so, they are not always effective. Most cartels embody a tremendous incentive for cheating.

Jeez, man............
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