Why “Big Oil” Will Survive the Crash in Prices

Comments (5)

  1. Earl Richards says:

    It costs $5 to produce a barrel of oil in Iraq, so Big Oil should not have any problem in making excessive profits.


  2. Victor says:

    Could you tell me what is going to happen to:

    I lost half my shirt on this……!


  3. Wisesooth says:

    Oil is not a generic product. Some of it is contaminated (sulfur, etc.). Other “oil” is so heavy that it has to be heated to make it flow (asphault, bunker-C, paraffin, etc.). Refineries blend their source of crude to closely match the needs of their output with the minimum of refining cost. Transportation is a huge factor in the cost of crude. That $5.00 per barrel price, though accurate, is the cost to pump one more barrel from existing sources, ignoring depletion of reserves, transportation cost to buyer, refining costs to make it salable for end-use, or fixed cost required to sustain production outputs. Aramco (Saudi owned) crude is light but not sweet. In other words, it can make jet fuel and gasoline (light), but is not sweet (loaded with contaminants like sulfur). U.S. shale oil is both light and sweet, with lots of natural gas. This is the starter product for a huge array of chemical compounds. Cost of crude is not the only factor to understand “big energy.”


  4. Sam Chaffin says:

    i believe these comments. they make sense to me.
    i will make investments based on this article.
    Sam C


  5. Polly Meulenberg says:

    In the past, when the U.S. went to war to control sources and ports. If so, will we go in with American troops following industrial complex directors to bomb that country into the stone age, as we did in Iraq, with neocons like Cheney, Rumsfield, Rice, Halliburton, Boeing, Lockheed, profiteering? That has been the story for the last 30 years…And Unicol in Afghanistan, now Russia to prevent transport to Baltic Sea? Why isn’t this discussed? Never mentioned.


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