It's Official - Exxon Hits Record Profits for Any Corporation Ever
08-05-2008, 07:21 PM
#31
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I got to see an interesting presentation from a Marathon representative here at a DOE conference today. Basically, if you take what he says at face value (and given my various paranoia's, I'll forgive anyone that doesn't), you can apply good ol' market fundamentals to the current situation.
First and foremost, diesel prices are the most important factor right now in transportation energy costs. Without diesel fuel, the world comes to a halt - and right now, refineries are doing everything they can to maximum the diesel cut from their streams. This means that there isn't a lot of artificial "throttling" of refinery output, at least not with regards to that particular fuel. It also means that the customers of diesel fuel are willing to pay a lot of money. The driving factor behind the cost of diesel fuel isn't the cost of a barrel of oil; it's the price that people are willing to pay, and the fact that diesel fuel supplies are pretty much fixed (this is a world-wide situation, BTW). Even with a barrel of oil going for $120, the $5-12(!)/gallon price of diesel is making refiners very, very rich right now. This isn't evil; it's just the way that supply and demand works. If you want to see more diesel fuel, figure out how to talk the refiners into making a multi-billion dollar investment into refineries that may or may not be useless before they pay for themselves; the combination of alternative fuels, government carbon controls, and Peak Oil means that too much uncertainty exists to justify 11-figure expenditures.
So, with that in mind, gasoline production may not be optimal right now. Still, there seems to be plenty to go around, because the amount of oil that we're turning into diesel means that there's fairly healthy production of gas. It's cheaper than diesel not directly because of the lower energy content or any difficulty in refining it; it's cheaper because the users of gasoline are somewhat more flexible in their demand (I can decide whether or not I go for a Sunday cruise; the garbage man gets no similar flexibility in his planning). Also, gasoline can be "cut" with ethanol, and so there's more flexibility here. No similar alternatives exist for diesel in the next ten years; since the US will need to produce something like 2M barrels/day of biofuels by the end of the next decade (per legislation signed last year), various ethanol blends will be pushed onto the public at whatever price it takes to sell the required amount.
At the other end of the price spectrum, the increased oil costs mean that a hit is being taken on the sale of asphalt, coke, and bunker fuel. There's not as much demand for these products, and the increased costs can't be passed on. Demand has established the price for these products.
Sorry for the rambling - I'm not sure if this provides any useful insight into the issue or not. I think the only solid conclusion that can be drawn from this is that it's going to suck to be a user of diesel oil (or any other medium distillate, such as home heating fuel) in the next decade or two. Frankly, I'm not sure that's a bad thing - the amount of energy available in a $5 gallon of diesel fuel is downright amazing, and higher prices perhaps will lead us to making the most of this gift.
First and foremost, diesel prices are the most important factor right now in transportation energy costs. Without diesel fuel, the world comes to a halt - and right now, refineries are doing everything they can to maximum the diesel cut from their streams. This means that there isn't a lot of artificial "throttling" of refinery output, at least not with regards to that particular fuel. It also means that the customers of diesel fuel are willing to pay a lot of money. The driving factor behind the cost of diesel fuel isn't the cost of a barrel of oil; it's the price that people are willing to pay, and the fact that diesel fuel supplies are pretty much fixed (this is a world-wide situation, BTW). Even with a barrel of oil going for $120, the $5-12(!)/gallon price of diesel is making refiners very, very rich right now. This isn't evil; it's just the way that supply and demand works. If you want to see more diesel fuel, figure out how to talk the refiners into making a multi-billion dollar investment into refineries that may or may not be useless before they pay for themselves; the combination of alternative fuels, government carbon controls, and Peak Oil means that too much uncertainty exists to justify 11-figure expenditures.
So, with that in mind, gasoline production may not be optimal right now. Still, there seems to be plenty to go around, because the amount of oil that we're turning into diesel means that there's fairly healthy production of gas. It's cheaper than diesel not directly because of the lower energy content or any difficulty in refining it; it's cheaper because the users of gasoline are somewhat more flexible in their demand (I can decide whether or not I go for a Sunday cruise; the garbage man gets no similar flexibility in his planning). Also, gasoline can be "cut" with ethanol, and so there's more flexibility here. No similar alternatives exist for diesel in the next ten years; since the US will need to produce something like 2M barrels/day of biofuels by the end of the next decade (per legislation signed last year), various ethanol blends will be pushed onto the public at whatever price it takes to sell the required amount.
At the other end of the price spectrum, the increased oil costs mean that a hit is being taken on the sale of asphalt, coke, and bunker fuel. There's not as much demand for these products, and the increased costs can't be passed on. Demand has established the price for these products.
Sorry for the rambling - I'm not sure if this provides any useful insight into the issue or not. I think the only solid conclusion that can be drawn from this is that it's going to suck to be a user of diesel oil (or any other medium distillate, such as home heating fuel) in the next decade or two. Frankly, I'm not sure that's a bad thing - the amount of energy available in a $5 gallon of diesel fuel is downright amazing, and higher prices perhaps will lead us to making the most of this gift.
08-07-2008, 12:40 PM
#33
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I got to see an interesting presentation from a Marathon representative here at a DOE conference today. Basically, if you take what he says at face value (and given my various paranoia's, I'll forgive anyone that doesn't), you can apply good ol' market fundamentals to the current situation.
First and foremost, diesel prices are the most important factor right now in transportation energy costs. Without diesel fuel, the world comes to a halt - and right now, refineries are doing everything they can to maximum the diesel cut from their streams. This means that there isn't a lot of artificial "throttling" of refinery output, at least not with regards to that particular fuel. It also means that the customers of diesel fuel are willing to pay a lot of money. The driving factor behind the cost of diesel fuel isn't the cost of a barrel of oil; it's the price that people are willing to pay, and the fact that diesel fuel supplies are pretty much fixed (this is a world-wide situation, BTW). Even with a barrel of oil going for $120, the $5-12(!)/gallon price of diesel is making refiners very, very rich right now. This isn't evil; it's just the way that supply and demand works. If you want to see more diesel fuel, figure out how to talk the refiners into making a multi-billion dollar investment into refineries that may or may not be useless before they pay for themselves; the combination of alternative fuels, government carbon controls, and Peak Oil means that too much uncertainty exists to justify 11-figure expenditures.
So, with that in mind, gasoline production may not be optimal right now. Still, there seems to be plenty to go around, because the amount of oil that we're turning into diesel means that there's fairly healthy production of gas. It's cheaper than diesel not directly because of the lower energy content or any difficulty in refining it; it's cheaper because the users of gasoline are somewhat more flexible in their demand (I can decide whether or not I go for a Sunday cruise; the garbage man gets no similar flexibility in his planning). Also, gasoline can be "cut" with ethanol, and so there's more flexibility here. No similar alternatives exist for diesel in the next ten years; since the US will need to produce something like 2M barrels/day of biofuels by the end of the next decade (per legislation signed last year), various ethanol blends will be pushed onto the public at whatever price it takes to sell the required amount.
At the other end of the price spectrum, the increased oil costs mean that a hit is being taken on the sale of asphalt, coke, and bunker fuel. There's not as much demand for these products, and the increased costs can't be passed on. Demand has established the price for these products.
Sorry for the rambling - I'm not sure if this provides any useful insight into the issue or not. I think the only solid conclusion that can be drawn from this is that it's going to suck to be a user of diesel oil (or any other medium distillate, such as home heating fuel) in the next decade or two. Frankly, I'm not sure that's a bad thing - the amount of energy available in a $5 gallon of diesel fuel is downright amazing, and higher prices perhaps will lead us to making the most of this gift.
First and foremost, diesel prices are the most important factor right now in transportation energy costs. Without diesel fuel, the world comes to a halt - and right now, refineries are doing everything they can to maximum the diesel cut from their streams. This means that there isn't a lot of artificial "throttling" of refinery output, at least not with regards to that particular fuel. It also means that the customers of diesel fuel are willing to pay a lot of money. The driving factor behind the cost of diesel fuel isn't the cost of a barrel of oil; it's the price that people are willing to pay, and the fact that diesel fuel supplies are pretty much fixed (this is a world-wide situation, BTW). Even with a barrel of oil going for $120, the $5-12(!)/gallon price of diesel is making refiners very, very rich right now. This isn't evil; it's just the way that supply and demand works. If you want to see more diesel fuel, figure out how to talk the refiners into making a multi-billion dollar investment into refineries that may or may not be useless before they pay for themselves; the combination of alternative fuels, government carbon controls, and Peak Oil means that too much uncertainty exists to justify 11-figure expenditures.
So, with that in mind, gasoline production may not be optimal right now. Still, there seems to be plenty to go around, because the amount of oil that we're turning into diesel means that there's fairly healthy production of gas. It's cheaper than diesel not directly because of the lower energy content or any difficulty in refining it; it's cheaper because the users of gasoline are somewhat more flexible in their demand (I can decide whether or not I go for a Sunday cruise; the garbage man gets no similar flexibility in his planning). Also, gasoline can be "cut" with ethanol, and so there's more flexibility here. No similar alternatives exist for diesel in the next ten years; since the US will need to produce something like 2M barrels/day of biofuels by the end of the next decade (per legislation signed last year), various ethanol blends will be pushed onto the public at whatever price it takes to sell the required amount.
At the other end of the price spectrum, the increased oil costs mean that a hit is being taken on the sale of asphalt, coke, and bunker fuel. There's not as much demand for these products, and the increased costs can't be passed on. Demand has established the price for these products.
Sorry for the rambling - I'm not sure if this provides any useful insight into the issue or not. I think the only solid conclusion that can be drawn from this is that it's going to suck to be a user of diesel oil (or any other medium distillate, such as home heating fuel) in the next decade or two. Frankly, I'm not sure that's a bad thing - the amount of energy available in a $5 gallon of diesel fuel is downright amazing, and higher prices perhaps will lead us to making the most of this gift.
Do you believe prices are actually set by the market? Oil, Gas, Diesel, etc?
08-08-2008, 08:03 AM
#34
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The one variable that the oil companies can control is the supply via refinery output. To what extent they do this to maximize their profits, I don't know; the Marathon dude seemed pretty sincere in stating that they were running their refineries flat-out to maximize diesel output, and DOE rep at the conference seemed to agree with this assessment (if indeed you can believe an oil guy and a government representative
). What gets really tricky, then, is how the output (and thus the pricing) of things like gasoline, propane, asphalt, and coke are controlled in order to maintain competitive and profitable pricing.It is clear that there is little incentive to increase refinery supply, because it costs tens of billions of dollars to do so, and would only have the effect of reducing price of "finished goods". And if you increase refinery production, you'd increase the demand for oil, and thus the cost of feedstock would increase, and so profitability would be further eroded. It's a particularly tricky optimization problem.
And at the end of the day, people are willing to pay the price for fuel because it still represents a good value. Frankly, I'll pay $5, $10, even $25 per gallon for diesel fuel, because the work that I get from my tractor still far outweighs the cost.
Last edited by Eric Bryant; 08-08-2008 at 08:06 AM.
08-08-2008, 08:45 AM
#35
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The prices are indeed set by the market - a certain amount of demand exists, and at some point that demand will be met by the supply at a particular price.
The one variable that the oil companies can control is the supply via refinery output. To what extent they do this to maximize their profits, I don't know; the Marathon dude seemed pretty sincere in stating that they were running their refineries flat-out to maximize diesel output, and DOE rep at the conference seemed to agree with this assessment (if indeed you can believe an oil guy and a government representative ). What gets really tricky, then, is how the output (and thus the pricing) of things like gasoline, propane, asphalt, and coke are controlled in order to maintain competitive and profitable pricing.
It is clear that there is little incentive to increase refinery supply, because it costs tens of billions of dollars to do so, and would only have the effect of reducing price of "finished goods". And if you increase refinery production, you'd increase the demand for oil, and thus the cost of feedstock would increase, and so profitability would be further eroded. It's a particularly tricky optimization problem.
And at the end of the day, people are willing to pay the price for fuel because it still represents a good value. Frankly, I'll pay $5, $10, even $25 per gallon for diesel fuel, because the work that I get from my tractor still far outweighs the cost.
The one variable that the oil companies can control is the supply via refinery output. To what extent they do this to maximize their profits, I don't know; the Marathon dude seemed pretty sincere in stating that they were running their refineries flat-out to maximize diesel output, and DOE rep at the conference seemed to agree with this assessment (if indeed you can believe an oil guy and a government representative
). What gets really tricky, then, is how the output (and thus the pricing) of things like gasoline, propane, asphalt, and coke are controlled in order to maintain competitive and profitable pricing.It is clear that there is little incentive to increase refinery supply, because it costs tens of billions of dollars to do so, and would only have the effect of reducing price of "finished goods". And if you increase refinery production, you'd increase the demand for oil, and thus the cost of feedstock would increase, and so profitability would be further eroded. It's a particularly tricky optimization problem.
And at the end of the day, people are willing to pay the price for fuel because it still represents a good value. Frankly, I'll pay $5, $10, even $25 per gallon for diesel fuel, because the work that I get from my tractor still far outweighs the cost.
Another question...
* Do you know what "eurodollars" and "pertodollars" are?
...and just this few more...
* Do you believe that a percentage of the price of every gallon of oil that we buy from some middle-eastern nations goes DIRECTLY back into our Federal Reserve to pay against our US National Debt?
* Do you believe that such an agreement could actually be a signed contract between the US and the foreign nation?
I am eagerly awaiting your response to these questions.
No joking, no strings attached, no kidding around.
You can provide the economics class if you want - I do read the whole post, but basic yes/no answers are OK too.
THANKS!
PP
08-08-2008, 11:01 AM
#36
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The only incentive to incrase production and lower prices would be if an oil alternative existed and oil was getting priced out of the market. Which is why the best way to reduce oil demand and prices is to work towards developing alternatives.
08-08-2008, 11:40 AM
#38
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08-08-2008, 11:53 AM
#39
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08-08-2008, 12:32 PM
#40
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Congrats to Exxon; they support so many companies in the USA we'd be damned if they would ever fail (the WHOLE economy).
And windfall profit won't happen. It's illegal and would get shot down in the supreme court.
08-08-2008, 12:58 PM
#41
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You may know something I don't - I'm not so certain 
Directly? No - I don't think it works that way. Indirectly? Oh, hell yes! FWIW, the mechanism by which "petrodollars" get back into our government's hands doesn't appear to be much different than how money flows through Wal-Mart righ back to our Treasury, so I don't view it as being especially evil - just evil in the normal sort of way
Could there be such an agreement? I guess so. Is there? I don't think so, primarly because the free market has already provided a mechanism for providing the US Treasury from my wallet (I send my money to a variety of countries overseas, which then uses those dollars to purchase US Treasury instruments, which then allows my government to maintain its habit of spending more money than it obtains from taxation).
Now - if you want to ask me if the US has deliberately weakened the dollar in an effort to perpetuate this situation, then I'd likely concur. But I'm not currently of the belief that there's an under-the-table formal agreement.
* Do you believe that a percentage of the price of every gallon of oil that we buy from some middle-eastern nations goes DIRECTLY back into our Federal Reserve to pay against our US National Debt?
* Do you believe that such an agreement could actually be a signed contract between the US and the foreign nation?
Now - if you want to ask me if the US has deliberately weakened the dollar in an effort to perpetuate this situation, then I'd likely concur. But I'm not currently of the belief that there's an under-the-table formal agreement.
08-08-2008, 01:20 PM
#42
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Short of the fact that analogy is completely off the wall and not even comparable... I'd drill my own well. You don't have to tap into city water. PITA for sure, but you could still survive.
Congrats to Exxon; they support so many companies in the USA we'd be damned if they would ever fail (the WHOLE economy).
And windfall profit won't happen. It's illegal and would get shot down in the supreme court.
Congrats to Exxon; they support so many companies in the USA we'd be damned if they would ever fail (the WHOLE economy).
And windfall profit won't happen. It's illegal and would get shot down in the supreme court.
YOU ARE NOT ALLOWED TO SIMPLY "DRILL YOUR OWN WELL".
You must obtain a permit to drill for water and it must be tested and approved for consumption before you can use it.
Likewise, most cities and municipalities do not even allow it, as their water tables are too contaminated and the water needs treating to be consumable, OR they have so much infrastructure underground that they do not allow drilling period (both occur in the nearest towns to my home).
I have a great friend I graduated with living outside Charlotte, NC who had the EPA show up at his door one day to take water samples from his well (an old house from the 1950s). They informed him that he was going to have to pay $ to get hooked-up to city water (the fee was split between he and the county?), and his well was going to be capped. He had no choice - either pay separately or they would attach lein to his property taxes for the hookup. Within 3 weeks, he was on city water and they pushed a plug about 50-feet into his well and poured it full of concrete to the top. His water was contaminated with hydrocarbons and selenium from a nearby gas tank farm.
COUNTY ENVIRONMENTAL STAFF DETERMINING IMPACT OF PAW CREEK AREA PETROLEUM SPILL
"Specialists from Mecklenburg County's Groundwater and Wastewater Services Program are identifying private drinking water wells within 1,500 feet of the gasoline release and sampling them as a precaution." Brian and his family are now on city water whether they like it or not. He asked about leaving the well to wash cars and water his lawn with, but the county refused his request due to "risk" of consuming the water via hose, spigot, etc - they wanted the well capped.
In short, you buy city water from the utility co or you buy bottled water - your choice.
NOW what are you going to do?
Now that that is over, please identify all these many companies that Exxon is "supporting"?!?! I can easily tell you how many companies they are KILLING by running them out of business due to fuel costs. So who exactly have they "helped" with their increased profits? The convenience store owner? The trucker that hauls it there? The shipping company that brough it here from BFE? The riggers that run the oil rigs? The pipeline companies? The automakers? The tire companies?
If anything, oil/gas production is DOWN, meaning less trafficking of product, less refining of product, and less sales of product (by volume). That doesn't help anyone in the movement process. The increased fuel costs have dessimated the auto industry as a whole - not just trucks and SUVS, so car sales are down, manufacturing is slow, people are laid off or terminated. The trickle-down effect then hits tier-1 and tier-2 suppliers who make the tires, radios, seats, etc that go into the cars and trucks that are not selling. They in turn stop using local businesses to do machine work, electrical contract work, maintenace, etc in the plants. And on and on.
PLEASE, tell me who Exxon-Mobil is "supporting" by making record profits?!?!
If the government would allow any Joe-Blow to start making their own fuel without $10s-of-millions in permits, regulations, compliance, codes, etc to get going - even without any capital assistance... well, then maybe we could talk about true competition and some level of parity. As it is, oil is an oligopoly that is given a blind eye from politicians who are personally benefitting from it's existance. They don't WANT it to go away or change... (duh).
08-08-2008, 02:53 PM
#43
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I love you bro! You are 1 smooth cat. 
Anyone can learn something from someone else. I have 8 years of university investment under my belt, but learn something from my 10-y/o daughter every day.
Directly? No - I don't think it works that way. Indirectly? Oh, hell yes! FWIW, the mechanism by which "petrodollars" get back into our government's hands doesn't appear to be much different than how money flows through Wal-Mart righ back to our Treasury, so I don't view it as being especially evil - just evil in the normal sort of way
Could there be such an agreement? I guess so. Is there? I don't think so, primarly because the free market has already provided a mechanism for providing the US Treasury from my wallet (I send my money to a variety of countries overseas, which then uses those dollars to purchase US Treasury instruments, which then allows my government to maintain its habit of spending more money than it obtains from taxation).
Now - if you want to ask me if the US has deliberately weakened the dollar in an effort to perpetuate this situation, then I'd likely concur. But I'm not currently of the belief that there's an under-the-table formal agreement.
Both answers await you in the single paragraph below.
"Following the OPEC oil embargo in March 1974, US Treasury Secretary William E. Simon, along with Assistant Secretary Jack F. Bennett, signed a secret accord in Riyadh with the royal Saudi Arabian Monetary Authority (SAMA) to lay the framework for a new petrodollar exchange system. Bennett had been partly responsible for Nixon’s earlier decision to “close the gold window” and would later become a director of Exxon. On June 8, 1974 the US-Saudi Arabian Joint Commission on Economic Cooperation was established by US Secretary of State Henry Kissinger in cooperation with the US Treasury and the New York Fed (Congress was never informed about this). The creation of this commission was to promote “industrialization” in the Saudi kingdom, but “the real reason for its creation was to cement long-term ties between the two countries and to ensure that Saudi Arabia would spend its newfound wealth in the United States,” notes Steven Emerson in his book The American House of Saud: The Secret Petrodollar Connection.[6] The official mandate from this commission cited the need for “cooperation in the field of finance” and the further need “to establish a new relationship through the Federal Reserve Bank of New York.” In summary, Saudi Arabia agreed to accept only US dollars for crude oil on commodity exchanges and then use a portion of these petrodollars to purchase US Treasury securities through the NY Fed. In exchange for this cooperation the US agreed to provide military protection and secret arms sales along with massive economic development within the kingdom."
Short version - a contract exists between the US and Saudi-Arabia since 1974 in which we buy oil from them, they put some of the money back into the US via the NY Federal Reserve (which supposedly directs it towards national debt reduction), and in return, we cover their *** with military security. It's not "under the table" as you suggested in your response - it's fully legitimate, signed by officials from each government... it's just not "highly public or well-advertized".
SO THERE IT IS. THERE'S YOUR DATE, YOUR PEOPLE, THE PLACE, THE NAME OF IT, AND EVEN THE BASIC TERMS AND CONDITIONS.
This agreement gives the US "access" to their oil reserves (largest in the world), allies by default, security for the US dollar, a free "credit card" on which to run the USA (pay for something on credit and let the cash flow return from oil pay it back), and a legitimate reason to leave US warships and bases in the Arab world to protect those reserves - er, I mean the Arabs.
It's a friggin' INGENIOUS plan. It's been going since 1974, yet nobody knows (or seems to care). The interesting part is, the same plan was carried throughout all oil producing nations as fast as possible, but 3 refused to sign on the dotted line of this program... Venezuela, Iraq, and Iran. Guess who we are at odds with in the world today? NOW you know why we are doing what we are doing in Iraq, and why some folks are nervous as hell about us going into Iran. Those are the folks "who know".
"If you don't pay, we come to play."
One more thing... a caveat in the contract.
If we EVER begin to supply ourselves with oil over a set percentage (i.e. drilling offshore in the Atlantic or Pacific, drilling in Prudhoe Bay, the north shore, etc), the contracts with these oil-producing nations becomes null and void - MEANING they can accept any form af currency, fromanyone, anywhere, anytime, and they can stop making the payments to the Federal Reserve. THAT'S F'ing HUGE folks. That means that right now, in our deepest debt ever ($9-trillion), the BIGGEST payers of that debt will get to stop paying.
NOW, do you understand why George and Dick don't want us to start drilling offshore or in Alaska?
NOW do you understand why we literally can't afford to provide ourselves with our own oil?
OK - time for more questions... search your soul (or the internet) deeply before answering these next questions...
* Do you believe that oil has been "chosen" as the commodity by which wealth and control of the world's finances and currencies will be based on - actually replacing gold, silver, and other precious metals?
* Do you believe that the wealthiest families in the world (people who make Bill Gates look like a peasant) control all of the world's finances and largest banks - are based in oil? Do such families/people even exist?
* Do you believe that the most powerful financial institutions on earth (which are controlled by private families and groups (OK, so this one's free
)) are setting the policy for oil production, refinement, and distribution all over the earth?
* Do you think there is an entity that actually TELLS the oil producing nations what they will be paid for a barrel of oil?
If we do this another day or two, we wil end up with a totally new view of how the price of oil at the pump today is actually a piece of a bigger plan - it's a form of "taxation" intended to get the wealthy, develped nations to "finance" a bigger plan.
A BAD plan IMO.
Anyone can learn something from someone else. I have 8 years of university investment under my belt, but learn something from my 10-y/o daughter every day.
Originally Posted by Eric Bryant
Originally Posted by PP
* Do you believe that a percentage of the price of every gallon of oil that we buy from some middle-eastern nations goes DIRECTLY back into our Federal Reserve to pay against our US National Debt?
Originally Posted by Eric Bryant
Originally Posted by PP
* Do you believe that such an agreement could actually be a signed contract between the US and the foreign nation?
Now - if you want to ask me if the US has deliberately weakened the dollar in an effort to perpetuate this situation, then I'd likely concur. But I'm not currently of the belief that there's an under-the-table formal agreement.
"Following the OPEC oil embargo in March 1974, US Treasury Secretary William E. Simon, along with Assistant Secretary Jack F. Bennett, signed a secret accord in Riyadh with the royal Saudi Arabian Monetary Authority (SAMA) to lay the framework for a new petrodollar exchange system. Bennett had been partly responsible for Nixon’s earlier decision to “close the gold window” and would later become a director of Exxon. On June 8, 1974 the US-Saudi Arabian Joint Commission on Economic Cooperation was established by US Secretary of State Henry Kissinger in cooperation with the US Treasury and the New York Fed (Congress was never informed about this). The creation of this commission was to promote “industrialization” in the Saudi kingdom, but “the real reason for its creation was to cement long-term ties between the two countries and to ensure that Saudi Arabia would spend its newfound wealth in the United States,” notes Steven Emerson in his book The American House of Saud: The Secret Petrodollar Connection.[6] The official mandate from this commission cited the need for “cooperation in the field of finance” and the further need “to establish a new relationship through the Federal Reserve Bank of New York.” In summary, Saudi Arabia agreed to accept only US dollars for crude oil on commodity exchanges and then use a portion of these petrodollars to purchase US Treasury securities through the NY Fed. In exchange for this cooperation the US agreed to provide military protection and secret arms sales along with massive economic development within the kingdom."
Short version - a contract exists between the US and Saudi-Arabia since 1974 in which we buy oil from them, they put some of the money back into the US via the NY Federal Reserve (which supposedly directs it towards national debt reduction), and in return, we cover their *** with military security. It's not "under the table" as you suggested in your response - it's fully legitimate, signed by officials from each government... it's just not "highly public or well-advertized".
SO THERE IT IS. THERE'S YOUR DATE, YOUR PEOPLE, THE PLACE, THE NAME OF IT, AND EVEN THE BASIC TERMS AND CONDITIONS.
This agreement gives the US "access" to their oil reserves (largest in the world), allies by default, security for the US dollar, a free "credit card" on which to run the USA (pay for something on credit and let the cash flow return from oil pay it back), and a legitimate reason to leave US warships and bases in the Arab world to protect those reserves - er, I mean the Arabs.
It's a friggin' INGENIOUS plan. It's been going since 1974, yet nobody knows (or seems to care). The interesting part is, the same plan was carried throughout all oil producing nations as fast as possible, but 3 refused to sign on the dotted line of this program... Venezuela, Iraq, and Iran. Guess who we are at odds with in the world today? NOW you know why we are doing what we are doing in Iraq, and why some folks are nervous as hell about us going into Iran. Those are the folks "who know".
"If you don't pay, we come to play."
One more thing... a caveat in the contract.
If we EVER begin to supply ourselves with oil over a set percentage (i.e. drilling offshore in the Atlantic or Pacific, drilling in Prudhoe Bay, the north shore, etc), the contracts with these oil-producing nations becomes null and void - MEANING they can accept any form af currency, fromanyone, anywhere, anytime, and they can stop making the payments to the Federal Reserve. THAT'S F'ing HUGE folks. That means that right now, in our deepest debt ever ($9-trillion), the BIGGEST payers of that debt will get to stop paying.
NOW, do you understand why George and Dick don't want us to start drilling offshore or in Alaska?
NOW do you understand why we literally can't afford to provide ourselves with our own oil?
OK - time for more questions... search your soul (or the internet) deeply before answering these next questions...
* Do you believe that oil has been "chosen" as the commodity by which wealth and control of the world's finances and currencies will be based on - actually replacing gold, silver, and other precious metals?
* Do you believe that the wealthiest families in the world (people who make Bill Gates look like a peasant) control all of the world's finances and largest banks - are based in oil? Do such families/people even exist?
* Do you believe that the most powerful financial institutions on earth (which are controlled by private families and groups (OK, so this one's free
)) are setting the policy for oil production, refinement, and distribution all over the earth?* Do you think there is an entity that actually TELLS the oil producing nations what they will be paid for a barrel of oil?
If we do this another day or two, we wil end up with a totally new view of how the price of oil at the pump today is actually a piece of a bigger plan - it's a form of "taxation" intended to get the wealthy, develped nations to "finance" a bigger plan.
A BAD plan IMO.
08-08-2008, 04:27 PM
#44
Registered User
Join Date: May 2004
Location: Shelbyville, IN
Posts: 2,043
Obviously, you do not live on a well (as I do).
YOU ARE NOT ALLOWED TO SIMPLY "DRILL YOUR OWN WELL".
You must obtain a permit to drill for water and it must be tested and approved for consumption before you can use it.
Likewise, most cities and municipalities do not even allow it, as their water tables are too contaminated and the water needs treating to be consumable, OR they have so much infrastructure underground that they do not allow drilling period (both occur in the nearest towns to my home).
I have a great friend I graduated with living outside Charlotte, NC who had the EPA show up at his door one day to take water samples from his well (an old house from the 1950s). They informed him that he was going to have to pay $ to get hooked-up to city water (the fee was split between he and the county?), and his well was going to be capped. He had no choice - either pay separately or they would attach lein to his property taxes for the hookup. Within 3 weeks, he was on city water and they pushed a plug about 50-feet into his well and poured it full of concrete to the top. His water was contaminated with hydrocarbons and selenium from a nearby gas tank farm.
COUNTY ENVIRONMENTAL STAFF DETERMINING IMPACT OF PAW CREEK AREA PETROLEUM SPILL
"Specialists from Mecklenburg County's Groundwater and Wastewater Services Program are identifying private drinking water wells within 1,500 feet of the gasoline release and sampling them as a precaution." Brian and his family are now on city water whether they like it or not. He asked about leaving the well to wash cars and water his lawn with, but the county refused his request due to "risk" of consuming the water via hose, spigot, etc - they wanted the well capped.
In short, you buy city water from the utility co or you buy bottled water - your choice.
NOW what are you going to do?
YOU ARE NOT ALLOWED TO SIMPLY "DRILL YOUR OWN WELL".
You must obtain a permit to drill for water and it must be tested and approved for consumption before you can use it.
Likewise, most cities and municipalities do not even allow it, as their water tables are too contaminated and the water needs treating to be consumable, OR they have so much infrastructure underground that they do not allow drilling period (both occur in the nearest towns to my home).
I have a great friend I graduated with living outside Charlotte, NC who had the EPA show up at his door one day to take water samples from his well (an old house from the 1950s). They informed him that he was going to have to pay $ to get hooked-up to city water (the fee was split between he and the county?), and his well was going to be capped. He had no choice - either pay separately or they would attach lein to his property taxes for the hookup. Within 3 weeks, he was on city water and they pushed a plug about 50-feet into his well and poured it full of concrete to the top. His water was contaminated with hydrocarbons and selenium from a nearby gas tank farm.
COUNTY ENVIRONMENTAL STAFF DETERMINING IMPACT OF PAW CREEK AREA PETROLEUM SPILL
"Specialists from Mecklenburg County's Groundwater and Wastewater Services Program are identifying private drinking water wells within 1,500 feet of the gasoline release and sampling them as a precaution." Brian and his family are now on city water whether they like it or not. He asked about leaving the well to wash cars and water his lawn with, but the county refused his request due to "risk" of consuming the water via hose, spigot, etc - they wanted the well capped.
In short, you buy city water from the utility co or you buy bottled water - your choice.
NOW what are you going to do?
Now that that is over, please identify all these many companies that Exxon is "supporting"?!?! I can easily tell you how many companies they are KILLING by running them out of business due to fuel costs. So who exactly have they "helped" with their increased profits? The convenience store owner? The trucker that hauls it there? The shipping company that brough it here from BFE? The riggers that run the oil rigs? The pipeline companies? The automakers? The tire companies?
If anything, oil/gas production is DOWN, meaning less trafficking of product, less refining of product, and less sales of product (by volume). That doesn't help anyone in the movement process. The increased fuel costs have dessimated the auto industry as a whole - not just trucks and SUVS, so car sales are down, manufacturing is slow, people are laid off or terminated. The trickle-down effect then hits tier-1 and tier-2 suppliers who make the tires, radios, seats, etc that go into the cars and trucks that are not selling. They in turn stop using local businesses to do machine work, electrical contract work, maintenace, etc in the plants. And on and on.
PLEASE, tell me who Exxon-Mobil is "supporting" by making record profits?!?!
If the government would allow any Joe-Blow to start making their own fuel without $10s-of-millions in permits, regulations, compliance, codes, etc to get going - even without any capital assistance... well, then maybe we could talk about true competition and some level of parity. As it is, oil is an oligopoly that is given a blind eye from politicians who are personally benefitting from it's existance. They don't WANT it to go away or change... (duh).
If anything, oil/gas production is DOWN, meaning less trafficking of product, less refining of product, and less sales of product (by volume). That doesn't help anyone in the movement process. The increased fuel costs have dessimated the auto industry as a whole - not just trucks and SUVS, so car sales are down, manufacturing is slow, people are laid off or terminated. The trickle-down effect then hits tier-1 and tier-2 suppliers who make the tires, radios, seats, etc that go into the cars and trucks that are not selling. They in turn stop using local businesses to do machine work, electrical contract work, maintenace, etc in the plants. And on and on.
PLEASE, tell me who Exxon-Mobil is "supporting" by making record profits?!?!
If the government would allow any Joe-Blow to start making their own fuel without $10s-of-millions in permits, regulations, compliance, codes, etc to get going - even without any capital assistance... well, then maybe we could talk about true competition and some level of parity. As it is, oil is an oligopoly that is given a blind eye from politicians who are personally benefitting from it's existance. They don't WANT it to go away or change... (duh).
1) Thousands of Sub-Contractors
2) Steel Companies
3) Industrial Hydraulic Companies (pumps/valves/cylinders/etc...)
4) It would take a whole page here listing all of the companies they support.
I work for a small filter company and on drilling rigs we do hundreds of thousand of dollars a year ( IN FILTER ELEMENTS ALONE!!!).
To say they aren't a major player in our economy is to just be blind...
08-09-2008, 09:30 AM
#45
Registered User
Join Date: Mar 2005
Location: Melbourne, Australia
Posts: 3,123
This morning I was shopping with my lovely wife for groceries at the nearby grocery store... my wife took a mental note of the price of apples, bananas etc... at a private grocery store in comparison to the prices at the Safeway supermarket we were to enter.
After we returned from Safeway, we were astonished to learn that the price of apples from the private grocery store had risen from $1.89/kg to $2.55/kg later that morning, thanks to the astute, price-sensitive, nous of my wife!!!
So what's the reason for the increase, I thought? Surely, not supply and demand because the apples were (presumably) from the same batch delivered. Nahh, it was just the store trying to take advantage of the increased patronage, later that morning. We decided not to reward such blatant opportunism.
Then it got me thinking about fuel prices...
After we returned from Safeway, we were astonished to learn that the price of apples from the private grocery store had risen from $1.89/kg to $2.55/kg later that morning, thanks to the astute, price-sensitive, nous of my wife!!!
So what's the reason for the increase, I thought? Surely, not supply and demand because the apples were (presumably) from the same batch delivered. Nahh, it was just the store trying to take advantage of the increased patronage, later that morning. We decided not to reward such blatant opportunism.
Then it got me thinking about fuel prices...