Formerly About Advanced Micro Devices Message Board

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Politics : Formerly About Advanced Micro Devices

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To: d[-_-]b who wrote (392828)	6/20/2008 1:51:19 AM
From: combjelly	Read Replies (2) of 1576614

"I can't figure your fascination with the market conditions for oil companies - you sound as if you're an angry investor." Not really. I grew up in what was essentially a company town. If you want to be bored with the history of the oil industry, I'd be happy to comply. At this point in time, the oil industry is totally driven by market conditions. Not just local minima or maxima, but long term. A state of the art refinery costs multiple billions of dollars. And it is low margin, which is why we haven't seen any built in the past few decades. It takes a long time to amortize the costs. Likewise for a well. The reason why drilling has been at a cusp is because all of the low-hanging fruit has been harvested. All of it. We are left with risky, and even if it produces, high cost wells. To get it, you have to convince the i-nodes that it can turn a profit. Unlike the one here, the ones in the corporate office want actual numbers and realistic, if not extremely conservative, projections. The majors play a long term game. They don't gamble like the wildcatters.

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