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It's nothing more than another commodities bubble artificially inflated by scum sucking bottom feeding commodities traders. Politics in the Mid east has always been volatile, what else is new? Ever since we deregulated everything in 1999 with the Financial Services Modernization Act and the Commodities Futures Modernization Act of 2000, the US economy has been farcical--a .com bubble, a housing bubble, an oil bubble, a gold bubble, a student loan bubble, and now a 2nd oil bubble. That's what happens when you let greedy douche bags on wall street run wild in a $600 Trillion dollar shadow derivatives market that our government has lost complete control over. Oil prices, just like many other commodities these days, has very little to do with the fundamental laws of free market economics. Consumers are all over the world are being gouged out the ace because of a handful of greedy traders manipulating entire markets. A barrel of oil these days trades hands 30 or more times before it is even used!
If there is even more gasoline produces prices will go down. No matter what. Economics 101/
If it was futures traders driving this market oil would be back to the all time high. There has never been more volatility in the middle east.
Are you suggesting that the government should force oil companies to produce more gasoline, which is against their business interests? Oil companies want to make higher profits. Oil companies know that demand is relatively inelastic, which means that demand doesn't drop much by raising prices and nor does demand rise when they lower prices. Thus, creating more supply will do nothing but create a glut and drop prices, while not gaining more customers. Why should oil companies do that?
Once we wrap our heads around the fact that oil companies have no interest in low prices nor increasing supply to force prices lower, we can understand the problem.
Oil is $108.32 right now. The reason it isn't higher is because there is so much on the market now.
What is the lowest price oil/bbl. needs to be to make ND oil profitable?
Don't know the answer to your question...but we do know that the 2009 average price of $75 and the 2010 average price of $90 must have been all of the incentive needed to ramp up production so dramatically.
Don't know the answer to your question...but we do know that the 2009 average price of $75 and the 2010 average price of $90 must have been all of the incentive needed to ramp up production so dramatically.
Are you suggesting that the government should force oil companies to produce more gasoline, which is against their business interests? Oil companies want to make higher profits. Oil companies know that demand is relatively inelastic, which means that demand doesn't drop much by raising prices and nor does demand rise when they lower prices. Thus, creating more supply will do nothing but create a glut and drop prices, while not gaining more customers. Why should oil companies do that?
Once we wrap our heads around the fact that oil companies have no interest in low prices nor increasing supply to force prices lower, we can understand the problem.
Oil is $108.32 right now. The reason it isn't higher is because there is so much on the market now.
Of course the first thing you think of if gov't interference
The higher gasoline prices go the less demand there is. When gas goes over $4.00 there is a sharp drop off in driving. Look what happened to natural gas prices with more drilling. Down. Oil companies are dying to drill at these prices!
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