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Thread: Gasoline prices zip toward $3 mark

  1. #31
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    Re: Gasoline prices zip toward $3 mark

    Quote Originally Posted by American View Post
    So why are we hesitating?
    Who is we?
    You must think the oil industry is stupid. Why would they want to increase supply and drive their profits down? Hello? Drill baby drill.......but how are you going to force them to drill?
    You do know how free market capitalism works don't you?
    A company does not flood the market with it's products driving prices down. They don't make any money that way.
    Last edited by Dirty Harry; 01-13-10 at 11:18 AM.

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    Re: Gasoline prices zip toward $3 mark

    Quote Originally Posted by Dirty Harry View Post
    Who is we?
    You must think the oil industry is stupid. Why would they want to increase supply and drive their profits down? Hello? Drill baby drill.......but how are you going to force them to drill?
    You do know how free market capitalism works don't you?
    A company does not flood the market with it's products driving prices down. They don't make any money that way.
    IIRC, nobody is talking about forcing the oil companies to drill. The oil companies have been trying to drill in these locations for years, but the government has not given them permission to do so. Should the government give them permission, I think it's a foregone conclusion that they will drill.

    Given the margin on oil, I don't think it's even possible for an increase in supply on this scale to reduce profits. Even if the price of oil drops $5/barrel (huge overestimate), the profit per barrel * the number of barrels recovered will more than make up for it.
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  3. #33
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    Re: Gasoline prices zip toward $3 mark

    Quote Originally Posted by RightinNYC View Post
    IIRC, nobody is talking about forcing the oil companies to drill. The oil companies have been trying to drill in these locations for years, but the government has not given them permission to do so. Should the government give them permission, I think it's a foregone conclusion that they will drill.

    Given the margin on oil, I don't think it's even possible for an increase in supply on this scale to reduce profits. Even if the price of oil drops $5/barrel (huge overestimate), the profit per barrel * the number of barrels recovered will more than make up for it.
    At 5 bucks a barrel everyone in the biz or invested would be bankrupt and there would be no drilling going on. Do you realize how much those rigs costs?

  4. #34
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    Re: Gasoline prices zip toward $3 mark

    Quote Originally Posted by winston53660 View Post
    At 5 bucks a barrel everyone in the biz or invested would be bankrupt and there would be no drilling going on. Do you realize how much those rigs costs?
    I meant if the price dropped by $5/barrel, sorry.
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    Re: Gasoline prices zip toward $3 mark

    Quote Originally Posted by RightinNYC View Post
    I meant if the price dropped by $5/barrel, sorry.
    Whoops my bad too I guess.

  6. #36
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    Re: Gasoline prices zip toward $3 mark

    Quote Originally Posted by Dirty Harry View Post
    Who is we?
    You must think the oil industry is stupid. Why would they want to increase supply and drive their profits down? Hello? Drill baby drill.......but how are you going to force them to drill?
    You do know how free market capitalism works don't you?
    A company does not flood the market with it's products driving prices down. They don't make any money that way.
    You think US Big Oil is buying oil at $70/barrel or selling it at $70/barrel?
    "He who does not think himself worth saving from poverty and ignorance by his own efforts, will hardly be thought worth the efforts of anybody else." -- Frederick Douglass, Self-Made Men (1872)
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    Re: Gasoline prices zip toward $3 mark

    Quote Originally Posted by American View Post
    You think US Big Oil is buying oil at $70/barrel or selling it at $70/barrel?
    Both. What do you think they pay for their own oil? You do know US Big Oil owns a lot of oil wells, don't you?

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    Re: Gasoline prices zip toward $3 mark

    Quote Originally Posted by Dirty Harry View Post
    You do know how free market capitalism works don't you?
    A company does not flood the market with it's products driving prices down. They don't make any money that way.
    Right, because keeping inventory low and prices high is how Wal-Mart rode the free market to the top. Everybody knows that, right?
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  9. #39
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    Re: Gasoline prices zip toward $3 mark

    Quote Originally Posted by Harshaw View Post
    Right, because keeping inventory low and prices high is how Wal-Mart rode the free market to the top. Everybody knows that, right?
    You do know the difference between commodities like crude oil and gasoline and a retail company like Walmart, don't you?
    Remember when crude was at it's peak? Oil profits were at theirs too.
    The truth is whether you will admit it or not is that oil companies like high gas prices.

    Interesting article:
    http://www.dailyfinance.com/story/no...gher/19313431/

    The second major reason U.S. gasoline prices are rising is tied to the companies that actually produce the product. Refiners' margins -- the profit they earn from refining crude oil into gasoline -- have dropped, so they've decreased production, which has resulted in less gasoline being made. Refiners are buying high-cost crude, but gasoline demand remains modest, which lowers the price they can sell the refined crude (gasoline) for. As the profit margin shrinks to unacceptably low levels, refiners stop refining gasoline.
    Last edited by Dirty Harry; 01-13-10 at 01:45 PM.

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    Re: Gasoline prices zip toward $3 mark

    Quote Originally Posted by Dirty Harry View Post
    You do know the difference between commodities like crude oil and gasoline and a retail company like Walmart, don't you?
    You were indicting "free markets" and how they "work," not "commodities."

    “Offing those rich pigs with their own forks and knives, and then eating a meal in the same room, far out! The Weathermen dig Charles Manson.”-- Bernadine Dohrn

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