It is well known that most people think foreign suppliers are the bad guys that are causing the price fluctuations in the oil market. The reality is the oil companies themselves are to blame.
All of the big refineries own loads of the wells that produce the crude that they use. They’re those that are selling the crude on the open market, their wells, their crude. They could make good money just pumping it into a tanker and shipping it to Russia or China without having to process it here within the states and pay all the taxes and fees which are imposed on them. Although these fees must be in place when you think about the negative impact that the refineries impose on our environment, even excepting the positive effect they have on the job market within the communities they’re located in. Plus, and this is a giant plus, a lot of the refineries are owned buy foreign interests.
Take Citgo for instance. Owned by Mr. Chavez, they’ve a lot of wells throughout the U.S. This is the very best crude because it contains phyto-chemicals that may be extracted to make different chemicals that we use every single day, that sell for a hugh markup, making it superior for the chemical industry. So it behooves Citgo to sell it to a chemical refinery like Shell and import the Venezuelan and Mexican oil [ second grade crude] to refine for our gas and diesel needs.
Or BP oil, owned by our neighbors to the north, Canada. British Petroleum owns loads of offshore wells near Louisiana and the east coast. Again it’s better to sell our crude and import theirs for our needs. [Canada is the largest exporter of crude to the U.S.] Next we’ve got Exxon /Mobile, supplied by their wells all around the U.S. and offshore. Same situation they usually get their foreign oil from an Arabian co. AraAmco [Arabian American company] The American interest is Standard Oil and some other big names.
So I believe you get the gist of this. Foreign oil, OPEC, speculators, supply and demand, none of those have a direct effect on the price of gas at the pump. Greed is the one factor that does. The gas at the pump was refined a month ago from crude that was put into storage several months ago and was purchased months before that at way less than spot price. There is no such thing as a reason to raise the value on the pump 10 cents today because there was a spike within the crude oil price yesterday.
The reply is not drilling in more areas [ Alaska or off the coast of California or within the northern U.S. ], although it will create more jobs, because without Government mandates that require the refineries to make use of all crude derived from within the U.S. boundaries for our needs first, it’ll just put extra money in foreign oil pockets and may have very little impact on our retail prices. The bottom line is we need to ween ourselves off of petroleum based fuel as much as possible. This probably shall be very hard to do as there are too many individuals, especially Congressmen and well healed businessmen, heavily invested in oil stocks. So what’s the answer? There are excellent “alternative energy” products on the market right now that may help us do exactly that, and with the federal government incentives that permit you to get back up to 90% of your investment within a year, it just makes good sense. Even if in case you have some huge cash in petroleum stocks you may implement some of these ideas at home and/or your corporation, still reap a monetary reward and help America too.
Oh, I almost forgot. Regardless that there are several people which have developed “TESLA” stile free energy devices they cannot be produced on the market as it’s against the law in the great old USA, Go Figure! Until the next time.