[DeTomaso] Kinda' NPC: Why does oil cost so much?

[michael@michaelshortt.com]

I agree with you in principle. I have always been fascinated with the
refining process and
wondered how Gas could be sold cheaper than a gallon of milk as it was
for over 100 years.

The real problem is that it is treated as a commodity, bought and sold on paper,
in futures, etc.

The price of 1 gal of regular in 2002 was approx 1.35
Even as your own chart shows, the 2002-2004 cost per barrel was anywhere from
20-30.00

yet, in 2009, when the price fell sharply, the retail price to
consumers did not follow
back down to the corresponding retail levels of around 1.50 per gallon.

In my book, that's gouging, plain and simple.

I eggs were a quarter and an egg sandwich cost a 1.00, I understand that,
if the price of an egg rises to .50, I could see the sandwich costing 1.30,
but when the eggs drops back drop to a ,25 and you're still charging 1.30,
you're gouging your customer.

I eschew Socialism, Communism, Marxism, etc., but if ever there was a product
that needed to have a world council set a price point on the wholesale
and retail level, gas
has to be at the top of the list.

Set a cost for the product at every level and leave it alone, keep it
away from spectulators
and wall street.

So much of the hoopla and price fluctuations seemed to be based on
politics and not the cost of
actually finding it, drilling, getting it out and processed.

Meanwhile, the worldwide "working man" is held hostage.


Michael Shortt





On Thu, May 31, 2012 at 3:06 PM, Kirby Schrader
<kirby.schrader at gmail.com> wrote:
> Needless to say... I wondered whether I should really do this or not,
> but I'm throwing caution to the wind.
>
> I work in the oil industry. I have since 1974. I spent most of the
> time overseas.
>
> Many times, the price of gasoline and why it costs so much comes up on the list.
> When offshore drilling rigs cost $1,000,000 a day to run and when the
> easy to get oil is long gone and it's tough to find new reserves, it's
> easy for the people working in the industry to understand why.
>
> But there are other reasons.... Politics, too! Would you believe it?
>
> I feel this article sums up the current scenario very well from an
> investor point of view.
> You don't have to know anything about the oil business to understand.
>
> Thought some of you might appreciate it. Some won't.
>
> http://www.caseyresearch.com/cdd/big-oils-cost-revenue-tightrope
>
> Now, I will run quickly back into my hole....
>
> FWIW,
> Kirby
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-- 







Michael L. Shortt
Savannah, Georgia
www.michaelshortt.com
michael at michaelshortt.com
912-232-9390


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