Just as the rest of us are taking a sigh of relief and enjoying a little extra money in our pockets. T. Butt Picker has to shoot his mouth off to strike fear into the mush heads.

Everytime he shoots his mouth off gas prices go up. People hear him speak, the next thing you know every body is filliing up their cars everyday. I bet gas will back up to over $2 a gallon by this weekend.


http://www.newsok.com/pickens-predicts-higher-oil-prices/article/3321278

If you want alternative energy sources, you'll need fuel costs to be high. People simply won't invest their money in something that they don't see a need for. When gas prices were high this summer, people were losing their collective minds and every time you turned on the TV you'd see a call for alternative fuel and a call to punish the gas companies or separate them from their profits. Once the prices dropped, all that halted. They even dropped the commercials. No one is shouting out to save the oil companies.

A buddy of mine works for an energy company. Now that the prices have dropped again, drilling contracts are getting cancelled and he may end up being laid off.

Someone once said the cure for high gas prices is high gas prices. It means the problem is self correcting.

Yup. Free market.

However, all of us better hope that oil and natural gas prices go back up or we're going to see some SERIOUS problems in our lovely state.

Oklahoma better fasten its seat belt. It has traditionally had a different economic cycle. Bad times are coming - one way or the other. My suggestion is to be putting back some money for a rainy day and making plans for when the jobs dry up. Start restructuring your budget while you have some wiggle room. Remember the old addage -"God please send another oil boom and this time I swear I won't piss it off?" Consider the current times a Boom. And hunker down. Get a good working car, stick to reasonable mortgage payments and put some money back.

Yup. Free market.

Except for when it isn't.

he tried to spew this crap when oil was 100+ per barrell saying it was on its way to 200+ because he held a long position. It didn't work and he lost a couple of billion

You know, you really add to your argument when you use nicknames like "T. Butt Picker"...

Has there ever been a documented account of Boone Pickens saying that energy prices would go LOWER?

east coast my father was just let go yesterday, said he might get his job back after the first of the year. So its exciting that gas prices are low, but for the first time I see what impact it has. Obama instead of creating new jobs, lets figure out a way to keep the jobs we have...I know i'm safe in the kitchen, ppl have to eat haha

There are several consequances of lower oil prices which will adversely affect Oklahoma. First, we're already seeing operating companies drastically cutting back. Oil prospects are being shut down and planned drilling is being shelved. This will result in the loss of thousands of jobs in OK - and, not just blue collar oil patch workers. Landmen, lawyers, and middle executives will also get squeezed.

Second, royalty owners will soon see there checks cut in half. They may have to start hocking their gold nugget jewelry to keep their McMansion mortgages paid.

Third, the asset bases of Oklahoma's major energy companies have lost 40% of their value. Not many companies can endure such a blow to their balance sheets without a significant alteration in their buisiness plans.

Fourth, Oklahoma's major universities have significant energy assets. This loss of value will cut deeply into OU's and OSU's endowments.

Fifth, OKC's energy companies have recently proved themselves to be good neighbors and good corporate citizens. They have invested millions into making OKC a better place. OKC has not had this luxury for many generations, if ever. These investments may dry up quickly.

Sixth, as energy prices continue in their decline, mass-transit, and especially subways and streetcars, will increasingly become a fantasy. No government agency will invest in trains when cars are so much less expensive for their citizens to operate.

We've all heard of trickle-down, and more recently, trickle-up economics. A 50% drop in the price of oil would be better characterized as splash-down economics. Its affects will be widespread and far-reaching.

We don't need to see oil rise back to the unprecedented levels of a few months ago. However, a good, solid $80.00 per barrel will put everything back on solid footing. And, the resulting rise in the price of gasoline will be tolerable.

You're spot-on, Chicken. I'd be happy to pay a little more in gas prices to ensure the Oklahoma economy maintains its strength.

I'm sure this is a stupid question...but something I thought of a few weeks ago...Oklahoma produces a lot of oil and Natural Gas...why couldn't, in theory, Oklahoma just produce for its own citizens and shelter ourselves from whatever is going on outside? Do we not produce enough? Lack of refining capacity? Again, I'm sure its a dumb question, just was wondering about it.

Well, we certainly produce more than enough of our natural gas needs. But what's the point of doing that? We need to sell it to get any value out of it.

Well, we certainly produce more than enough of our natural gas needs. But what's the point of doing that?

To shelter yourself from whatever goes on in the rest of the world...so your prices can remain stable...

I don't know if we have the refinery capacity to produce our own gasoline, but I would guess that we probably do.

The thing is: we need money coming in from outside. That's the value of this deal. We're not building boathouses and skyscrapers based on OKlahoma's purchasing and usage of our assets.

Without outside revenue, the Oklahoma producers don't have enough volume to keep the doors open, I suspect.

So what about selling some inside and some outside? enough to take the edge off outside factors?

Lets just say the last 18 months didn't happen with oil prices. Wouldn't the current price be near historic highs?

My guess is that we already pay less for natural gas here than they do in, say, NYC. You'd need a local refinery dedicated to taking LESS money from Oklahomans that outsides are willing to pay. Just not going ot happen without some form of government intervention.

Why would a private company do that? I think they'd have to be careful to not start running afoul of the interstate commerce clause.

And yes, I think Oklahoma already gets a break but I don't know exactly why other than, perhaps, lower costs to supply/transport. Someone else might know.

T. Butt Picker is one of the nicer things I'd call that clown.

If you want alternative energy sources, you'll need fuel costs to be high.


Exactly. I'm willing to pay $4 a gallon or more if it means we are forced to be environmentally responsible. Sucks for my pocketbook, but its the only way we'll ever change.

And yes, I think Oklahoma already gets a break but I don't know exactly why other than, perhaps, lower costs to supply/transport. Someone else might know.


That's mainly it.

T. Butt Picker is one of the nicer things I'd call that clown.

Assuming that your name is what it is because you are a sooner fan, is part of that animosity because he gives lots of money to OSU athletics? Just a thought.

I know he wasnt very popular many years ago as a corporate raider, but in my lifetime Im not sure I have a reason to hate Boone. He has done a lot of good recently.

And him saying gas prices will go up is like saying the sun will continue to rise. Although I dont think it will go up as fast as he thinks, but then again he is a little more of an expert.

No, honestly, I admire what he has done for OSU. I think it's great when someone can give back to their school, no matter what the school may be. My negativity stems from his "raider" days.

Exactly. I'm willing to pay $4 a gallon or more if it means we are forced to be environmentally responsible. Sucks for my pocketbook, but its the only way we'll ever change.

Maybe we should have two prices at every station. We could have one that is priced $1.90 and one at $4.00. My guess is no one would ever use the $4.00 pump. Some recent studies suggest that a certain type of rock absorbs CO2, the rock is then subducted below the surface and under heat and pressure oil is formed. If true, then so much for the fossil fuel scare mongers.

Ever since these gas prices started going up some years back and all the way up until now...does anyone actually have any records of anything major being done with that extra profit to bring on alternative energy? I am serious...does anybody here have any documentation on this?

...because in the last couple of years, I have been watching the energy committees call on the energy execs to testify and bring with them documentation showing what they were spending on alternative's and any details on that process...

...in addition to the sky-high prices that we were paying, the government has been giving $ to the oil companies, something upwards of a billion a year if I recall (will go back and look) and I was watching when they were all called in to testify and they collectively came up with like $100 million that they spent "researching" alternative energy but had to documentation to show what had been done. They took not only the extra profit at the pump, but that $billion or so a year from our pockets and had no documentation to show that they spent more than roughly $100 million and the rest they kept.

I see where a lot of folks are suggesting that the higher prices will solve the problem over time...I'm just curious how long you would guess it would take at $4 a gallon before anything might start to surface?

Understand, that we consumers pay not only for gas at the pump, but in everything we buy. When we buy stuff at the store, when we ship something... I work in the pro audio/video industry and nowhere throughout my entire career have I ever seen so many letters from manufacturers apologizing for yet another after another increase in prices due to transportation costs, fuel specifically.

In 20 or 30 years of this industry, even through the last energy crisis, we never saw this much increase over and over and over and over again...we just saw another wave of letters from manufacturers last month.

I am listening to your points, but we're not just paying $4 a gallon for gas...it keeps getting worse and worse and worse.

I am assuming it will let up since the decrease in energy costs is down somewhat.

Most alternative energies (i.e. wind, solar, tidal, hydrogen fuel cell, etc.) are more expensive than our conventional energies (i.e. oil & coal). So, when the price of conventional energies rise, alternatives become even more appealing and attract investment. On the other hand, when the price of conventional fuels falls, that investment dries up. It's simple market economics.

I don't have a definitive source, but I heard that Pickens' wind farm has been scuttled (at least temporarily anyway). It no longer makes sense to spend billions on this energy when oil is so much cheaper. Yes, it's short-sighted. But supply and demand tends to be short-sighted. In the long run, according to Alfred Keynes, we're all dead.

Although I wish people would invest in alternative energies because it is the right thing to do, in reality, they will only do so if it improves their bottom line. Higher oil and gasoline prices make alternatives viable. I think we'll see more widespread adoption of hybrid technologies, clean-coal power plants, wind energy, etc. when there is financial incentive.

I thought he was a sleaze long before he started throwing money at OSU. He is a pump and sell guys, he buys a bunch of stock on credit, which pumps up the price and scares the company into buying the shares back, forcing them to clean out accounts and sell off the pieces and that included many Oklahoma based companies that he looted. Pickens is a modern day thief, plain and simple, he just uses different means and methods. Whenever he opens his mouth it is only to serve one purpose, to fatten his wallet. The whole "Pickens Plan" was designed to drive up oil and gas prices because of his vast holdings of those and the ability to affect the speculation market. He is a sleaze, pure and simple.

Yes, he has stalled his wind project, this story came out today.
Austin Business Journal - T. Boone Pickens stalls wind farm project (http://www.bizjournals.com/austin/stories/2008/11/10/daily34.html)

Thanks for the reply,

I hear what you are saying, but ever since prices at the pump shot up years ago when the iraq thing started, some people have been telling me that now that prices were up, we would see all this great investment by the oil companies in alternative energy. At this point, I have no evidence to show that any of the oil companies have invested any real resources on exploring the alternative energies--and where have these years of record profit gone to??? Clearly the bank by their testimony...along with $1 billion per year of our tax dollars.

There's always some excuse as to why with the record profits and extra government funding that they have not built one new refinery in forever...always somebody else's fault although we pay them to go through the compliance steps in building.

I still have the record of the acceptance of the funds from the government by the oil co's though...and thank the many folks on those committees who are working to cutoff this funding. Why should we be giving our tax dollars to a for-profit oil company to fund something that they are going to profit from US on in the future??? And they are just putting it in the bank!

Correct me if I happen to be wandering in the land of dee-dee-dee, but for as long as I remember, starting a business was risk you had to invest in if you wanted to profit from it. If joe blow wanted to open up a shop and sell stuff to make money, he had to buy the shop and buy the stuff to sell...then when /if his business succeeded, he would get his profit. If it failed, then he should have run it better.

In recent years, I have seen companies (and some people) have taken the position that the company should not have to endure the loss of profit stemming from BAD BUSINESS DECISIONS...after all, they CANNOT and DO NOT make mistakes and any failure of their's to run the business properly is OUR problem and they invoice us for it...because heaven forbid the company have to give up any of it's profit for the bad business decisions they did not and could not have possibly made, let alone admit to any wrongdoing! I know this is leaning off-topic, but I want to make a point that all business is a risk...regardless of what the oil co's think.

If an oil company wants to build a new HQ, or do anything to improve their company, for some reason, it is now OKAY for them to charge US at the pump for these improvements that will ultimately benefit their bottom line! This includes exploring new technologies--somehow the survival of their business model in the future requires us to fund their future ability to sell to us???

All the while, the grocery chain around the corner has to watch their spending and be happy with what they've got or spend part of their profit to improve the company...because if they wanted to up the price of a can of soup from $.88 to $4.00 to buy a shiny new building, their competitors would put them out of business! THEY HAVE TO PAY FOR IT OUT OF THEIR PROFIT! Not the oil companies...they hold hands together and show us, that any business risks are OUR responsibility because their profit is untouchable and we owe them...more and more every day.

You know, I actually heard someone on this forum recently say that they were dealing with a relative that was recently laid off from an energy company due to the falling prices...and that just proves my point even way further. All that built up cash pile was 100% of their concern. You really think they couldn't afford to keep those folks on-board??? After years and years of record prices and government gift-wrapped bonuses??? AND ONLY A COUPLE WEEKS AFTER THE PRICES GO DOWN THEIR LAYING PEOPLE OFF? Must be to protect that bottom line, eh?


Sorry, I had to get that out...probably the 1000th time I've told that rant.

The reason you don't see viable alternative energy sources is two fold. 1) We have enough oil for the next 500 years, and 2) It isn't as bad for the environment as some make it out to be.

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So then that high price really won't lead to nice, quick fixes after all eh? ;)

No, but high prices lead to lower demand which lead to lower prices which lead to higher demand which lead to higher prices... and around and around we go. The reason we are starting to see such large swings in price is because we are at 102% of refinning capacity.

Ah, yes...the only way I'd work for an oil co is as a temporary janitor.

Ah, yes...the only way I'd work for an oil co is as a temporary janitor.

???? Are you a janitor?

If you'd work for them at all (given your apparent animosity), at least take a job that pays.

No I am not a janitor, but if I were to take a job with an oil co, I would take something like a janitorial position, something that would not be missed too much when let go by the waves of hires and layoffs, hires and layoffs, etc... definitely would not look for any kind of career position there.

Thanks for the reply,

I hear what you are saying, but ever since prices at the pump shot up years ago when the iraq thing started, some people have been telling me that now that prices were up, we would see all this great investment by the oil companies in alternative energy. At this point, I have no evidence to show that any of the oil companies have invested any real resources on exploring the alternative energies--and where have these years of record profit gone to??? Clearly the bank by their testimony...along with $1 billion per year of our tax dollars.

There's always some excuse as to why with the record profits and extra government funding that they have not built one new refinery in forever...always somebody else's fault although we pay them to go through the compliance steps in building.

I still have the record of the acceptance of the funds from the government by the oil co's though...and thank the many folks on those committees who are working to cutoff this funding. Why should we be giving our tax dollars to a for-profit oil company to fund something that they are going to profit from US on in the future??? And they are just putting it in the bank!

Correct me if I happen to be wandering in the land of dee-dee-dee, but for as long as I remember, starting a business was risk you had to invest in if you wanted to profit from it. If joe blow wanted to open up a shop and sell stuff to make money, he had to buy the shop and buy the stuff to sell...then when /if his business succeeded, he would get his profit. If it failed, then he should have run it better.

In recent years, I have seen companies (and some people) have taken the position that the company should not have to endure the loss of profit stemming from BAD BUSINESS DECISIONS...after all, they CANNOT and DO NOT make mistakes and any failure of their's to run the business properly is OUR problem and they invoice us for it...because heaven forbid the company have to give up any of it's profit for the bad business decisions they did not and could not have possibly made, let alone admit to any wrongdoing! I know this is leaning off-topic, but I want to make a point that all business is a risk...regardless of what the oil co's think.

If an oil company wants to build a new HQ, or do anything to improve their company, for some reason, it is now OKAY for them to charge US at the pump for these improvements that will ultimately benefit their bottom line! This includes exploring new technologies--somehow the survival of their business model in the future requires us to fund their future ability to sell to us???

All the while, the grocery chain around the corner has to watch their spending and be happy with what they've got or spend part of their profit to improve the company...because if they wanted to up the price of a can of soup from $.88 to $4.00 to buy a shiny new building, their competitors would put them out of business! THEY HAVE TO PAY FOR IT OUT OF THEIR PROFIT! Not the oil companies...they hold hands together and show us, that any business risks are OUR responsibility because their profit is untouchable and we owe them...more and more every day.

You know, I actually heard someone on this forum recently say that they were dealing with a relative that was recently laid off from an energy company due to the falling prices...and that just proves my point even way further. All that built up cash pile was 100% of their concern. You really think they couldn't afford to keep those folks on-board??? After years and years of record prices and government gift-wrapped bonuses??? AND ONLY A COUPLE WEEKS AFTER THE PRICES GO DOWN THEIR LAYING PEOPLE OFF? Must be to protect that bottom line, eh?


Sorry, I had to get that out...probably the 1000th time I've told that rant.


A few things:

1. Apparently you don't like capitalism if you expect companies to keep employees hired at a loss.

2. American oil companies do less to affect the per barrel price of crude than you think.

3. People try to build refineries. No one lets them because no one wants them in their backyards. We all want cheap gas, but we don't want those smelly, loud, dangerous places near us.

3. People try to build refineries. No one lets them because no one wants them in their backyards. We all want cheap gas, but we don't want those smelly, loud, dangerous places near us.

Tell me about it. In Florida we pay more for gas because we ship it in from Aruba.

All the while, the grocery chain around the corner has to watch their spending and be happy with what they've got or spend part of their profit to improve the company...because if they wanted to up the price of a can of soup from $.88 to $4.00 to buy a shiny new building, their competitors would put them out of business! THEY HAVE TO PAY FOR IT OUT OF THEIR PROFIT! Not the oil companies...they hold hands together and show us, that any business risks are OUR responsibility because their profit is untouchable and we owe them...more and more every day.



This is precisely the argument for additional anit-trust oversight. We have so few energy compnies controlling such enormous market shares, there is little competitive pressure. If there were 6,000 mid-sized energy companies rather than 6 mega-companies, we may see a more competitive market place. Yes, this is inherently less efficient than monoploies or oligopolies, and it is certainly more difficult for government oversight, but it is better for the public.

I've made this same argument against monopolistic practices in airlines, broadcasting and news companies, drug store chains, auto manufacturers, and virtually every other major industrial segment. Where is our Teddy Roosevelt?

OKCMallen,

1. Apparently I do understand capitalism because I described the stark difference in how the rules have been changed mainly for oil companies. The few companies that control the market hold hands and if they want to charge $20 a gallon for gas even if the price they pay hasn't gone up...they can do that and they WONT be put out of business because those few MEGA companies hold hands and do it together and what little oversight was there has been done away with. I will follow this up with a great article I recently read that told about the changes that have occurred in the agency that investigates the oil co's and how their hands have been tied when they dig into any issues they find. THE ENERGY COMPANIES HAVE BEEN GIVEN A FREE TICKET TO MERGE AND CONSOLIDATE AS THEY PLEASE WITH NO OVERSIGHT, EFFECTIVELY GIVING THEM ALL THE CONTROL THEY WANT.

Side note: controlled capitalism has been found to work decently well in the U.S. Large businesses make decisions based on what helps their bottom line...much different that the barber shop guy or the one-location restaurant with that food that you like much better than the national chain. Little guys have to compete and focus on more than just profit alone. Once a large business gains enough market share, it is much harder for them to lose and therefore they have no reputation to uphold and no need for quality standards...it is raw down and dirty business at that point. Historically, very large businesses have been monitored by the government to ensure that they weren't forcing us into their hands by becoming the "one and only" source. Uncontrolled capitalism on a large scale can become very dangerous. It's the "control" factor.


2. It has nothing to do with oil companies controlling the price. They take their percentage just like they always have. HOWEVER, the higher the price goes, the more actual $ they get, so it is in their best interest to do nothing to invest in alternative energy OR build refineries because any two of those things would lower the price and would result in less profit. THE OIL COMPANIES ARE DOING WHAT THEY DO BECAUSE IT IS MORE PROFITABLE WHEN THE PRICE IS HIGH. PERIOD. IT IS BUSINESS. THEY HAVE NO BUSINESS REASON TO INVEST ANYTHING IN TECHNOLOGY THAT WILL HURT THEIR BOTTOM LINE. THE HIGH-PRICE GAS FROM THE MIDDLE-EAST IS DOING THEM JUST FINE.

3. The government does have a lot of red tape for building refineries. What do you think the $ that they are given from the government to assist in that compliance is for??? We don't just give them free $$$ for exploring new technologies. The government gives them tons of handouts for compliance and the department that was set-up to monitor that flow of cash anad make sure that it was spent wisely has been downsized in this administration and contained in terms of what they can investigate (the article link will be provided soon). THE OIL COMPANIES PUT THAT COMPLIANCE MONEY IN THE BANK AND TELL THE CONSUMERS THAT THEY ARE BEING PUSHED INTO A CORNER BY THE GOVERNMENT.

Chicken in the Rough, you are correct. And we used to have a program in place...not as good as we need, but it was there. I may need a day or so, but I have a link to the article here somewhere.

Methinks someone is a bit sensitive. I didn't say you didn't understand it. I said you apparently don't like it. Which I still say because you think energy companies are apparently bad or somethin because they don't invest money in technologies that will make themselves obsolete?

No one's saying there shouldn't be oversight, particularly as to monopolistic-style practices. BUT I'M NOT SURE WHAT YOU'RE RAILING ABOUT. I THINK YOU'RE GOING DOWN A DANGEROUS ROAD BY IMPLYING THAT COMPANIES SHOULD BE REQUIRED TO KEEP UNPRODUCTIVE/UNPROFITABLE EMPLOYEES ON THE PAYROLL JUST BECAUSE OF YOUR SENSE OF FAIRNESS OR WHATEVER YOU'RE BASING THAT ON.

OKCMallen,

This is debate and I dont take anything you've said personally. I am responding to your post, which stated that I 'dont like it'. My response is to clarify that indeed I do like it...when it is controlled...obviously, I stated examples of good capitalist operations. Sorry for using the word 'understand'.

In regards to the payroll thing--listen, every company has their good and bad times and handles personnel accordingly. I am just saying that it is quite funny for a business that has had many of it's oversight removed and has collected on record profits for so many years, that they give their workers the boot the day the prices go down...you know?

Other industries don't have the luxury of collecting all that extra dough up for so many years, other companies have to compete...and if they are laying off, it is because the cash is not in the bank. Energy companies are a whole different ballgame. Of course I expect them to layoff, it is just funny that they pretend to be hurting.

Again, I want to stress that this is good debate and I am all for it. I have nothing personal against you...feel free to attack and I'll be glad to debate it with you.

BTW-my capitalization was intended to sum up the point, perhaps it would have been better handled as an underline. I wasn't shouting.

You guys do know that oil companies do not set the price of oil don't you. As with every other product on the planet, the consumer sets the price. The main problem with the oil industry is there are a lot of middlemen the oil has to pass through between the oil pump and the gas pump.

The bribes to the UN, multiple taxes from multiple countries, lease payments to the US federal government, Wall Street oil traders, "campaign contribution" to every level of government, lobbiest, canal fees, and on and on and on. Oh yea, the people actually doing the work of getting the oil out of the ground and into your gas tank also want to get paid. The US Congress has had multiple investigations for years about why gasoline and oil cost so much. The conclusion of all of those investigations is that government involvemnet is reason for the high prices. If you think more government regulation (whatever that means) is the answer your crazy.

Kerry, your first line is simply not true. The oil co's can push the price as they wish...they are a vendor and their oversight has been mostly removed. I appreciate your insight into the issue, but nothing changes the fact that oil companies make more $ when the price at the pump is higher. That is fact. Therefore, it comes as no surprise that they are doing little to change the situation. They have access to lobbyists, but you notice that they are not up making a stink before the committees about domestic drilling and building refineries, they are only talking about it. They are only maintaining discussion on the issue to contain the issue and make it look like they are "working on it"...more of a PR thing to keep the public under wraps. When the issues of where the billion or so a year (just for alternative energy) were going to, and we found out it was put in the bank, they started the wave of commercials talking about alternative energy.

I'll say it again, oil companies make more $ when the price at the pump is higher. Therefore, they have no business reason to change course when they are making record profits.

One of the points that I made was all the giveaways that are given to the big oil co's...upwards of a billion $ a year for alternative energy alone and it was found out by investigation they are putting the majority of that in their bank and not using it for what it was intended (again, no surprise) Should we not be pulling that funding and directing it to a more useful place...for example, the stockpile of debt? Now, that's just one of many kickbacks the government is sending their way.

Kerry, your first line is simply not true. The oil co's can push the price as they wish...they are a vendor and their oversight has been mostly removed.

Please tell me the name of the OPEC oil company. I am unaware of any oversight that has been removed. Repeating campaign slogans doens't make it true.

Read the following story and tell me how many times and oil companies name is mentioned.
Bloomberg.com: Worldwide (http://www.bloomberg.com/apps/news?pid=20601087&sid=aOPLpIWyxhR4&refer=worldwide)

There is a government agency that oversees energy companies and verifies compliance and conducts investigations, however, during this administration, they have been downsized to nearly nothing. I am still working on getting that link and will post as soon as I dig it back up.

If (name of oil co) wants to raise the price at the pump at its stations by $.20 a gallon, there is nothing to prevent them from doing this.

You guys do know that oil companies do not set the price of oil don't you. As with every other product on the planet, the consumer sets the price. The main problem with the oil industry is there are a lot of middlemen the oil has to pass through between the oil pump and the gas pump.

Also, the cost of drilling is obscene. Two weeks ago, we had a single well come in at a cost of over over $9 million. This was our most expensive well ever. We've got over 50 wells in the pipeline (excuse the pun), and we're a pretty small player in the business. This represents nearly a half-billion dollars in drilling alone.

If (name of oil co) wants to raise the price at the pump at its stations by $.20 a gallon, there is nothing to prevent them from doing this.

So why don't they do it then? Just 2 months ago gas was $4.00 per gallon. I paid $1.94 Thursday in Atlanta. If the oil company can just name their price then why isn't gas still $4.00 per gallon?

However, all of us better hope that oil and natural gas prices go back up or we're going to see some SERIOUS problems in our lovely state.



Didn't Forture and Mayor Micky say we're recession proof?

Kerry,

As you just pointed out, the price is a roller coaster...how do you know how much of that price goes to the oil co? They're a vendor along the line just like everybody else from the ground to our tank.

Didn't Forture and Mayor Micky say we're recession proof?

That was the name of an article but it was just an article with a catchy name. No way is OKC recession proof under the right circumstances. On fact, I fully expect things to turn down before too long - and then they will make an upswing if people keeps their wits about them.

Kerry,

As you just pointed out, the price is a roller coaster...how do you know how much of that price goes to the oil co? They're a vendor along the line just like everybody else from the ground to our tank.

How much of the price of bread goes to the farmer that grew the wheat? They both sale their product on the commodities market. The point it is doesn't matter how much of the price goes to the initial sources of the product. I have to pay what it cost. If cost too much then I cut back.

That's exactly the point. How many farmers are there vs oil co's? Chicken in the Rough made the same point. You don't see bread at $10/loaf because there are so many and they compete... Not oil co's...they have merged into a few and hold hands as they do whatever they want. Now, in a big city with nice public transit, a person can be less reliant on fuel...but in a place that's not only dominated by automobile transit, but also spread out so far, some folks would have to ride for an hour or two to get to work on a bike, or sometimes more on what little alternative transit we have.

It is pretty fair to say that if you need to get around OKC on a schedule, you gotta buy gas and own/maintain a car, and you can't necessarily cutback beyond your minimum, like trips to work.

You point to bread as an example, although there are "alternative breads" unlike fuel, it doesn't compare because that market hasn't tried to mold itself into a few large bread co's trying to control the market and skyrocketing prices. If even a large group of farmers tried to up their prices, they'd be run off by the huge competition overnight. Not to mention, the government would start to see it as a monopoly and break it back up to restore competition--resulting in lower prices and higher quality. The oil industry is tightly controlled. If an outside company wanted to come in and compete, the large oil co's would use their huge amount of $ to lobby them out of town...we all know they have plenty of friends in Washington. Anything they need...they would get them shutdown immediately. And now that they can merge and play however they want without fear of oversight or ompetition.

In a place like Oklahoma City, the argument is a good one. Because we have little alternatives, the system has been set-up to push us to rely on gas like we do the city for water and trash.

If we had alternatives means of transit here that could be relied on to be efficient and affordable, then your argument on cutting back would definitely apply...obviously in that case, there would be viable alternatives...but not like it is now.

I think you are missing the point of a commodities market. It doesn't matter if there is one oil company or 1000 oil companies. A barrel of Exxon oil cost the same as a barrel of BP oil (assuming they are the same grade). The commodities brokers/buyers set the price not the seller. Gold, Silver, wheat, and corn work the same way. When you go to the grocery store to buy corn do you select the individual farmer to buy from? No, you just buy the corn that is on the store shelf. The commodities market is just a large EBAY. The person doing the buying sets the price and the highest price wins. The bad news for us is we have to buy gasoline from the people that paid the most for the oil.


You point to bread as an example, although there are "alternative breads" unlike fuel, it doesn't compare because that market hasn't tried to mold itself into a few large bread co's trying to control the market and skyrocketing prices.

FYI on your bread comment. Check out Interstate Bakeries Corporation. They have most of the US market but they sell bread under about 20 brand names.
IBC - INTERSTATE BAKERIES CORPORATION (http://www.interstatebakeriescorp.com/)

Kerry,

I didn't say a word about what the oil co's pay for the oil...I complained about their markup before it hits us and how since there is no competition, they can do whatever they want with that markup without any type of oversight...

Since there is a small, controlled group of oil co's in the U.S. that supply our gas to us, they hold hands and can do anything they want to the price as it passes through their hands...they do not have to worry about competition because their small group is all 'on the same page' with each other...they aren't in competition. And to touch on your comment about buying from the oil co's that pay the most...dude, they have no reason in the world to do anything but celebrate higher costs on the oil they buy. That extra expense doesn't touch them...it passes on to US. And since they add in their percent share of markup, it gives them an excuse for why their profits are so high. If they wanted to hike their profit margin, this would obviously be the perfect time to do it...as the prices are bouncing around...how would we know what is coming from the market and what is coming from them?

Your point on the supermarket is incorrect. I DO have a choice of what product I buy from whom. While you are correct that there are lots of 'brands' that operate under one larger parent company, not all of those products are that way. There is usually more than one brand 'on the shelf' and if a particular store tries to limit what they carry, I can go right down the street to their competitor and get the brand I want from the vendor I want. There IS choice and because there is competition, the prices won't spin out of control.

When you go to the grocery store to buy corn do you select the individual farmer to buy from? No, you just buy the corn that is on the store shelf.IBC - INTERSTATE BAKERIES CORPORATION (http://www.interstatebakeriescorp.com/)

Actually, I do buy directly from farmers whenever possible. I buy bread from the bakery rather than from the grocery store. I buy produce from farmers and farmers markets when possible. As a personal policy, I favor local producers, proccessors, or suppliers over nationals. Our voices are more significant to locals, and they care more about our communities. Nationals do not have the same attachments or loyalties.

We need to leave this macro economic mindset behind and embrace the fact the local economies should be held in higher esteem. I would love to have the opportunity to buy my gasoline from a small company who drilled, extracted, and refined their own product, bypassing the brokers and commodity markets. To some, this may seem utopic. To me, this is the goal.

We need to leave this macro economic mindset behind and embrace the fact the local economies should be held in higher esteem. I would love to have the opportunity to buy my gasoline from a small company who drilled, extracted, and refined their own product, bypassing the brokers and commodity markets. To some, this may seem utopic. To me, this is the goal.

Check out the history of Standard Oil. They tried that and the price of oil products was so low they drove everyone out of business. It worked so well for them the government made what you just described illegal.

If it was up to me I would do away with the commodities market for everything. However, I work with a finance guy and he explained to me why it is needed. SGRAY seems to be stuck on the idea that having more oil companies would drive down the price of oil. That simply will not happen in an industry where the price is determined via a commodities market. The only was to drive down the price of oil is to have cars that burn something other the gasoline. In short, we don't need competition in the oil market, we need competition to the oil market.

As I have stated in other threads, I already own my last gasoline engine. If Detroit, Tokyo, Seoul, or Stuttgart wants to sell me another car it better run on something besides gasoline. The fuel efficiency standards set by the government are doing more harm than good. Automobile companies are spending all of their research dollars trying to increase fuel economy and I would rather them spend that money finding an alternative to the gasoline engine.

All we need is an engine that can go 60 miles a day (about 99% of all driving) without using gasoline. I don't care if that engines runs on CNG, electricity, dry leaves, or kittens.

<<I don't care if that engines runs on CNG, electricity, dry leaves, or kittens. >>

I draw the line at kittens.