Your wish is my command: U.S. begins buying back oil for strategic petroleum reserve -official O.k., maybe not "my" command, but I'm sure it's somebody's command.
West Texas breaks its own record with an earthquake that was 5.4 on the Richter scale, in less than a month since they set the record. 5.4 quake jolts West Texas, one of state's strongest ever In a few more months of growing earthquakes at this rate, the west coast of Texas could break away and form its own continent. Yeehaw!
so can you renegotiate that long dated diesel contract you signed? All those that were so happy to bash Biden when the price spiked are now silent. It was stupid to blame him then and it would be foolish to credit him now.
saw that Friday. Like I said in post 195, nice move but 3M buy on 160M sell is woefully short. They need a 20M + buy to start moving the needle and take advantage of these depressed prices while they are down.
Guess that’s one way of looking at it. Must be the nuanced way of calculating a profit. Seems the cost basis gets lost in your formula, but everyone is entitled to their own way of filling out a P&L
Ahh, but you are asking people to pay for your choices unless you are arguing for a cap-and-trade system, as your choices have negative externalities on others without payment without some sort of cap-and-trade system. In the same way that fisheries don't let you just catch whatever you feel is best for your personal or business needs. Your choices have impacts on others.
Not sure I understand. If I paid $40k for my car, loaned it to you, you sold my car for $96k, then you bought me the same car for $76k and gave it back to me… you’d have a profit and I’d have my car.
What is not clear about the math. At first you have 180 million barrels of oil. Then you have 180 million barrels of oil plus $3.6B.
I very much doubt they put that money in an account somewhere. There is a huge downside here though, if the same government you're praising for great choices hadn't created an environment where oil cost so much the US consumer would have a lot more than $3.6B in their pockets. And no, the war in Ukraine is not why oil is expensive.
I'm not an experienced politician but I'd imagine doing things like calling SA a pariah state, enacting policies that make capital for refinery capacity expansion very hard to come by, and halting new oil and gas leasing on federal onshore lands and offshore water don't really help to lower prices. If he was interested in lowering prices he'd do things like encourage the expansion of refinery capacity and begin his presidency with positive foreign policy moves towards our allies rather than embarrassing himself having to grovel for their resources later. It's kind of like me stealing a bunch of crab legs from Publix until I get banned and have to shop at Whole Foods now. Kinda dishonest for me to complain about increased cost of groceries if I did it to myself, right? I mean technically whole food would be the reason my costs are higher, and a moron might fall for that reason, but anyone with a functioning brain would make the connection pretty quick.
So I see three theories here for why oil is expensive: 1. We were mean to SA after their government lured a US resident to an embassy, murdered him, and dismembered his body. 2. Didn't push for greater domestic refineries. 3. Didn't grant leases to new leases offshore and onshore on federal lands in the US. Okay. So as to number 1, what should the US response be to that event? Ignore it? Even saying bad things about the perpetrators is too much of a reaction? As to number 2, how does that impact oil prices? Refineries buy the oil... As to number 3, last month saw the 9th highest monthly production of oil in US history. The peak was in the year prior to the pandemic. We are almost back to that point in domestic production, which is really not a major influence on global oil prices. So one of those three maybe had a large influence. And that is saying mean things about the Saudis after they murdered a US resident.
I love how people like the poster you responded to like to assert some kind of economic expertise and then consistently choose to ignore one of the most fundamental basic tenants of the crude oil market, it is a global market.
You also lose money on storing the oil. Both to maintain the storage facility and as working capital (e.g., the money invested in the oil could have been put in the stock market at 8%). It's still worthwhile investment even if it doesn't make money, of course.
1. SA held a trial and the verdict was accepted by his family. You might not like it but they are a sovereign state and an ally. I find it funny that something like this is enough for JB to call SA a pariah state, meanwhile China can do whatever it wants with millions of Muslim citizens and get pretty much no reaction. This is clearly because JB does not care if oil prices rise and wants virtue points. He has clearly spoken of and implemented anti fossil fuel policy regardless of its impact on the average american. And yes, I am more concerned about the average American than I am about a Saudi citizen dissident journalist who is dumb enough to go into a Saudi embassy. 2. Domestic refinery capacity is a huge problem. It is well known even to people who aren't economists. I've attached the first google result I found below. 3. That's correct and makes sense as to why oil prices would rise as a result. Add to that the influence this policy will have on item #2 above. Here’s Why The U.S. Has Lost Oil Refining Capacity
It is. The US is a large global producer and refiner. Unfriendly policy will impact the global market too, as well as our own.
