Oil companies already have leases in Alaska on state lands to drill for and pump oil. A few months back, the State of Alaska threatened to cancel those leases because the oil companies weren't drilling and hadn't submitted plans to do so. If the oil companies have no plans to drill in the North Slope leases they already have, why the push to open ANWR?
I also read that when the big oil companies were called in front of Congress this last time, they were asked if they had any plans to build more refineries. The unanimous answer was "No". This is in line with what happened in California. The major oil companies supported environmental regulations that the smaller refiners couldn't afford to meet, causing them to close. A couple of years ago, Shell threatened to close their Bakersfield refinery. After a lot of state government pressure, they were forced to consider a deal by Flying-J (I recall). Fewer refineries operating at higher (and company controlled) capacity equals higher profits.
kmb1966 wrote: If anyone is waiting for the Exxon/Chevron/Shell/Conoco/BP boys to do anything about current market conditions, keep waiting. Not trying to bash these companies, but if my company was making record profits, the last thing I'd do is start expanding my capacity for supply, when that tight supply has allowed the flow of money to come my way. Why would you do anything to change that? If demand drops, just cut back production (do a little refinery maint) and make the price go up more. If you increase production, you run the risk of too much supply and then you can't yell "SHORTAGE"!!! when a little fog gets in the Gulf.
Your argument assumes a monopoly, which for the oil industry is as far from reality as you can get. The price of oil is not set by any one or combination of companies when you have dozens of producing countries and multiple dozens of companies all playing in the same global market. When you and 20 other guys are all selling the same commodity at a handsome profit, whether you sell more or less will have little effect on the going price but a big effect on your on income.
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Bubby's RV wrote: Oil companies already have leases in Alaska on state lands to drill for and pump oil. A few months back, the State of Alaska threatened to cancel those leases because the oil companies weren't drilling and hadn't submitted plans to do so. If the oil companies have no plans to drill in the North Slope leases they already have, why the push to open ANWR?
I also read that when the big oil companies were called in front of Congress this last time, they were asked if they had any plans to build more refineries. The unanimous answer was "No". This is in line with what happened in California. The major oil companies supported environmental regulations that the smaller refiners couldn't afford to meet, causing them to close. A couple of years ago, Shell threatened to close their Bakersfield refinery. After a lot of state government pressure, they were forced to consider a deal by Flying-J (I recall). Fewer refineries operating at higher (and company controlled) capacity equals higher profits.
Concerning the Alaska leases -- how do we know those are good places to drill? If the potential is low and costs are high, the companies are right.
Concerning refineries -- the cost of crude, not refinery limitations, are why fuel is so high. "Fewer refineries operating at higher (and company controlled) capacity equals higher profits." Which actually means they are operating in the most efficient way. Why not?
kmb1966 wrote: If anyone is waiting for the Exxon/Chevron/Shell/Conoco/BP boys to do anything about current market conditions, keep waiting. Not trying to bash these companies, but if my company was making record profits, the last thing I'd do is start expanding my capacity for supply, when that tight supply has allowed the flow of money to come my way. Why would you do anything to change that? If demand drops, just cut back production (do a little refinery maint) and make the price go up more. If you increase production, you run the risk of too much supply and then you can't yell "SHORTAGE"!!! when a little fog gets in the Gulf.
Your argument assumes a monopoly, which for the oil industry is as far from reality as you can get. The price of oil is not set by any one or combination of companies when you have dozens of producing countries and multiple dozens of companies all playing in the same global market. When you and 20 other guys are all selling the same commodity at a handsome profit, whether you sell more or less will have little effect on the going price but a big effect on your on income.
Well, didn't have time to rattle off every name in the industry, but the point is the same ... they complain about shortages and at the same time take no action in expanding their refinery capacity. The question comes up how many new refineries, yet you find article after article of Oil execs admitting that they are not going to build new refineries because they make more money by NOT building them.
Bubby's RV wrote: Oil companies already have leases in Alaska on state lands to drill for and pump oil. A few months back, the State of Alaska threatened to cancel those leases because the oil companies weren't drilling and hadn't submitted plans to do so. If the oil companies have no plans to drill in the North Slope leases they already have, why the push to open ANWR?
I also read that when the big oil companies were called in front of Congress this last time, they were asked if they had any plans to build more refineries. The unanimous answer was "No". This is in line with what happened in California. The major oil companies supported environmental regulations that the smaller refiners couldn't afford to meet, causing them to close. A couple of years ago, Shell threatened to close their Bakersfield refinery. After a lot of state government pressure, they were forced to consider a deal by Flying-J (I recall). Fewer refineries operating at higher (and company controlled) capacity equals higher profits.
Concerning the Alaska leases -- how do we know those are good places to drill? If the potential is low and costs are high, the companies are right.
Concerning refineries -- the cost of crude, not refinery limitations, are why fuel is so high. "Fewer refineries operating at higher (and company controlled) capacity equals higher profits." Which actually means they are operating in the most efficient way. Why not?
That's the reason now, but before it was REFINERY excuse. Then it was KATRINA, now it is the CRUDE oil price. Looks like the crude oil price is the only believeable reason and it's tie to the falling dollar value. That refinery excuse is so old and worn out, even the oil exec's don't use it anymore.
kmb1966 has it right!The oil companies have found the way to make outrageous profits so why would they voluntarily increase oil/gas production and reduce their profits.A big, fat excess profits tax on the major oil companies would do it!All profits used to build more refineries, drill more wells (ANWAR) and most importantly, open more shale oil facilities would be exempt from the tax. No one today seems to be aware that during the last big oil runnup during the '70s a major oil company invested billions in oil from oil shale and was able to produce and sell it profitably for $40/barrel. Of course, when the OPEC gang saw what was happening they turned up the pumps and drove oil down to $20/barrel! As a result, the project was abandoned!
Furthermore, 90% of oil shale is under government land and it's estimated to contain many billions of barrels of oil!
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Did you know that the Federal Government makes more from taxing fuel than the oil companies (and their shareholders, people with pensions, 401k's, TSA's, etc.) make from selling it?
Who's making the outrageous profits?
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jesterdog wrote: I was thinking(look out). Let's say we did start drilling in Anwar, and offshore CA and other areas in the US and hit big oil.
Would that affect the price of oil?
Wouldn't Shell or whoever just pump it out of the ground and charge us the same $126 a barrel that they charge everybody else, no matter where they pump it from?
What am I missing?
From my understanding, it might or might not lower the pump price. All crude oil prices are not the same. What it would do is strengthen the U.S. dollar, and in turn that should lower our fuel prices.
Did you know that the Federal Government makes more from taxing fuel than the oil companies (and their shareholders, people with pensions, 401k's, TSA's, etc.) make from selling it?
Who's making the outrageous profits?
LOL. Fed tax on fuel is eighteen cents a gal regardless of price per gallon. Big oils outrageous profits speak for itself.
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