[Mr 5 0]

Originally Posted by Unit 5302

The same company responsible for shutting down the pipeline, British Petroleum, was recently charged with market tampering with propane prices so they certainly have proven they have a propensity for this kind of thing.

Please notice that one of the witnesses against BP, a former trader plead guilty to what? Conspiracy.

That particular incident may neatly fit your 'conspiracy' template but it doesn't come close to proving BP and/or any other oil company has 'conspired' to raise gas prices at the pump, as you infer. You'll have to do a bit better than guilt by association. A BP trader and his cohorts pulling an illegal attempt to manipulate a section of the natural gas market and, upon his sentencing, his pointing fingers (with no evidence to back his accusations) at BP senior management, claiming he 'thought' the illegal manipulation attempt had their 'approval', does not constitute an industy-wide 'conspiracy', or even a BP conspiracy. Even the court ignored this bogus line of defense at the convicted trader's sentencing.

Nice try, though, as you managed to find a news story with 'oil company'and 'conspiracy' in the same sentence. Good work, even if it proves nothing.

As for your arguments about demand, they're nothing short of baseless.

Kell, you are woefully uninformed if you honestly believe that.

Tell you what: let's look at your statements and then bring some facts into the discussion, shall we?

There is no shortage of oil, and OPEC has offered to increase production if necessary multiple times.

Now, I don't recall claiming that there ever was a 'shortage of oil'. I was trying to make the point that the available oil supply is basically finite and the ever-increaseing demand for the available (crude) oil naturally pushes up the price on the market. It's that simple.

As for your rather touching belief in the alleged beneficence of OPEC:

As recently as December, 2004, OPEC threatened to reduce its daily oil output by 1 million barrels a day if the price didn't rise. It did. Worldwide, oil is trading at around $78. per bbl. today (8/10/06). A steep rise in price that has absolutely nothing to do with alleged oil company conspiracies but can clearly be attributed to a 'tight' oil market based on pipeline delivery and often-related weather problems.

OPEC's monthly report (released 8/7/06) stated that OPEC's crude oil output dipped by 250,000 barrels a day in July, even as prices rose toward record highs, after a pipeline leak in Nigeria and maintenance in Venezuela hit production. Crude output from OPEC fell to 29.55 million barrels a day last month, the report stated. Well, so much for the 'OPEC will supply us with all the oil we need' myth. They cannot, they will not and they do not.

Oil market analysts project that the worldwide demand for oil will continue to grow at a rate reaching approximately 15% over the next 10 years. That will also have an impact on gas prices here in the United States in the years to come. It has to. Yet the environmentalist groups continue to oppose any oil exploration in the U.S., which is simply irresponsible. However, domestic oil production is expected to slightly increase over the next 18 months, which is a positive sign.

The US does not refine gasoline for other world markets before supplying it to the US markets.

(bold added by JS - for emphasis).

Please don't be disingeneous. U.S.-based oil companies import the majority of the crude oil they purchase from other sources, including OPEC, and they have to compete for that oil with other nation's oil companies, many state-owned and run, including those in Russia, China and Japan. Still, it doesn't matter how much crude oil a company imports, until it's refined down to gasoline that meets U.S. standards, including carefully mixing in a bunch of additives mandated by the various states and separating the gas into state-specific truckloads, an expensive process, it's useless to the consumer - or even to those who just want to buy (refined) oil, such as manufacturers and distributors of heating oil. That the U.S. oil refining capacity is now and has been strained to the max in the for 30 years due to the lack of new refineries being built, because the federal and state environmental regulations make it economically impossible to build them, is a real factor in the price of gas at the pump. Are you unaware of that reality? I didn't think you were.

Furthermore, oil companies have readily admitted to controlling gasoline prices in the interest of curbing demand to prevent shortages. This flies in the face of the reality that increased gasoline prices has not resulted in a signficant reduction in gasoline purchases.

Furthermore, 'controlling the price' simply means setting a market price for your product or commodity based on a reasonable profit margin (about 6¢ per every dollar of sales, annually) just as farmers and manufacturers do. Every business 'controls' it's product's market price, setting a price for wholesale and retail buyers then adjusting it according to market conditions. You must be aware of that marketing basic. Frankly, this use of semantics is ridiculous. Then, we're discussing conspiracy theories here, so why am I not surprised? Ah well, let's continue examining your statements and see what we can find.

The mere fact that oil companies admit to controlling the price of gasoline is enough to warrant investigation. Multiple companies working together to keep prices artificially high is called price fixing.

Of course oil companies would like to really control the price of gasoline! Why wouldn't they? Why shouldn't they? However, wanting to do something and actually doing it are two far different things, as you know. I'm sure the oil companies would like gas, at retail, to sell for $10. per gallon, just as Ford would like to sell cars for $150,000. apiece, like Rolls Royce does. So what? All gasoline consumers have to do is cut back on their consumption a noticable amount (cut back unnecessary driving and ditch the outsized, gas-guzzling vehicles) and any attempt by any oil company to 'control' the price of gas at the pump goes out the window, fast. There is absolutely no profit on unsold gasoline. It's axiomatic that a decreased demand for gas would certainly help lower the price of gas. I wish we would do this. Fat chance. Instead, we complain and look for oil company 'price-fixing conspiracies' that do not exist. It's frustrating.

Unit, you must know that the U.S. runs as a 'free-market' economy, not a socialist or communist-style, 'controlled' economy. The really big oil companies, many foreign and even those who are domestic, have huge investments, not only in exploration attempts but in the expensive, almost one-of-a-kind equipment used to drill for, extract and transport crude oil. The companies also have to pay fat fees to the governments of the countries where they buy or extract the crude oil they refine and sell. Then, there are the taxes. Lots of taxes. Foreign taxes, federal taxes and state taxes on oil and oil company profits. No, I don't feel sorry for them. I should also state that I don't own any oil company stock nor am I related (or even know) anyone in the 'oil' business, I'm just stating a fact - that oil companies pay a lot of taxes. Not enough for some folks satisfaction, I'm sure, but a lot, all the same.

It's rather obvious that, after 30 investigations over the past 20 years by various government regulatory agencies (during both Democrat and Republican administrations), there is no substantial evidence of oil companies 'fixing' the retail price of gas. If there were, their top executives would have been indicted and likely jailed, if not publicly flogged, by now. The 'price-fixing'/'price manipulation' accusations bandied about (especially on the internet - where there is no accountability) whenever pump gas prices rise significently is baseless. I'm surprised you even bothered to use it, here, as you must realize it is quite unsupportable. However, even people who have the resources to do some real research - not simply comb the internet seeking validation for their assumptions - and should know better, such as Fox News star Bill O'Reilly, apparently still buy into the oil company 'price fixing' myth, despite a severe lack of evidence to back up that claim. Then, they try to cliam that if the FTC doesn't find wrongdoing by the oil companies, they must be 'covering it up' and are deemed 'ineffectual' or even 'corrupt'- realistically translated as: "They don't find what I want them to find". No, I do not attribute these comments to you, personally, Kell. This being the case, I'm not really surprised that many ordinary folks are eager to swallow the 'oil company price fixing' hoax. I am simply disappointed that one of them is you. The oil company executives that testified before that (useless) Senate committee awhile back freely offered to open their books to any government investigation. So much for conspiracies. The whole thing was simply political grandstanding. Do you not realize that? I bet you do.

As one of the industry executives stated, the U.S. has about 2% of the world's oil supply and uses 25% of the oil. Do you honestly think that this does not effect the price of refined gasoline at the pump - or are you one of those folks who assume 'cheap' gas is some kind of constitutional right? Since I assume you know better, then why do you keep insisting that there is a 'conspiracy' to raise gasoline prices ? There is not - and none has ever been demonstrated, much less, proven.

Let's at least try to be realistic, shall we? Gas prices are a 'hot-button' issue and both politicians and the media are quick to jump on any appearance of oil company pricing 'collusion', real or, in this case, imagined. However, the oil & gas business is very tightly regulated in the U.S. and any 'conspiracy' to raise gas prices minus any provable justification would be eventually found out, exposed and severely punished. Despite the claim of a few conspiracy-theory diehards that no indictments of oil company execs somehow 'prove' they must be guilty and are just paying off people in the Bush administration, the fact remains that almost all of the political left-wing - Democrats - which control 49% of the congress - despises 'big oil' (along with Wal-Mart). There is no way they would let the opportunity to make political points with the electorate and at the same time, 'stick it' to oil companies and by (falsely assumed) association, President Bush, slip through theeir fingers, as it were. No way. Even big oil and (purely hypothetical) big bribe money can't block rank political opportunism in this politically divisive era. Besides, not everyone can be 'bought'.

Well, at least you refrained from accusing President Bush of being 'behind' the gas price upsurge and trying to 'enrich his oil buddies' as the loonier internet websites claim. I'll give you that, at least.

There is always a burden of proof to be met in order to take accusations seriously, and in the face of the non-stop excuses spoon fed to the American public amidst world record setting profits, there is simply no room for doubt here.

High gas prices and resultant oil company profits when crude oil delivery is diminished and gas consumption drastically increases, for very obvious reasons, such as high consumption levels, are a simple 2+ 2 equation. Supply (especially constrained with the finite number of refineries in the U.S.) and demand (growing every year as the population grows and affluency grows with it) is also an obvious reason for escalating gasoline prices, which in the U.S., is actually less than what Europeans pay, because in Europe, gas is heavily taxed, thanks to their (failing) socialist economies. In addition, here at home, most state's taxes on gas are unfairly high (43¢ per gallon in my politically 'liberal' state), adding to the price at the pump. This simply enriches hypocritical politicians anxious to spend the gas tax money from over-burdened taxpayers while blaming 'big oil' for high gas prices and holding kangroo-court 'hearings' (press conferences, really) and convincing the gullible that it's all a 'conspiracy'. I am somewhat disappointed that you appear to have bought into this sham. I always considered you a savvy guy.

Sorry, Unit, but I do not take your accusations about oil companiy 'conspiracies' at all seriously. I see lots of 'room for doubt here'. I think that other folks do, too. Well, I certainly hope so.