Why is the U. S selling its Oil and Gasoline?

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Why not keep it here to keep prices low and let people spend their money on other things?
 
Because oil companies are in the business of making money.

If you want to keep it here and make less, buy an oil company and do just that.

Or buy oil company stocks and get paid dividends when they make more money.

Originally Posted By: ZZman
Why not keep it here to keep prices low and let people spend their money on other things?
 
In effect, the USA is exporting refinery capacity. That isn't necessarily a bad thing. It does distort the numbers to make it seem that we need to import a lot of crude. Actually much of that oil is being refined and re-exported.

Keeping refineries at full capacity is a major way the industry fixes prices. Notice that the price of gasoline or diesel only loosely follows that of crude oil.
 
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Selling gasoline overseas provides jobs to Americans in the refining sector. The crude oil being sold overseas is due mostly to the over abundance of light oil, mostly from North Dakota. One half of that oil goes to Eastern Canada where the refineries are set up to process light oil, commonly imported from world wide sources such as the Middle East. A heavier blend of oil is imported from Western Canada. Most of that oil is sent to the USA mid west refineries but some makes it down to the Gulf Coast. It’s a win-win situation. Heavy Canadian oil is priced way cheaper than WTI (West Texas Intermediate), so Americans do benefit in the form of cheaper gasoline. Up in Canada, we’ll always have oil for our American friends.
 
The Oil isnt owned by the US unless you are talking about the strategic reserve. There is no US Oil company of America. The oil reserves already been sold through drilling and mining rights to large corporations. Opening up drilling gives the oil to those companies with only small royalties to the country
These companies even those HQed in the US have no responsibility to do business with the perspectives of whats best for the US. In fact they actually have a fiduciary responsibility is to do what's best for the company/shareholders and they would be breaching that responsibilty by not maximizing profit or company growth

where is the politics lock
 
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That's very naive - why not keep it here and keep prices low.

If you're saying why not make gov't. powerful enough to interfere with private competition, then show me a gov't. that did not also take their oil and sell it internationally for short-term benefit of their politicians. Every country puts taxes or fees on their oil exports, and uses those for pet projects. At least in the US we don't idle an entire generation, acting like the money will never run out and therefore we don't need to build, grow, or export anything else.
 
Oil companies operate to make money, like any business. I don't have a problem with them exporting their products as long as prices here stay reasonable. If we're paying $3.50-$4 or more for our gas due to tight supplies, that's different...then I would say we should be keeping more of it here to keep our prices reasonable...
 
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Originally Posted By: ZZman
Why not keep it here to keep prices low and let people spend their money on other things?

Its a world economy man. Ships leave and arrive in this country with every conceivable product. The price of all comodities is determined on the "Spot Market" here and around the world. Why would a U.S. company seel oil in the U.S. when it could sell it for more somewhere else.

You are thinking that its 1950? Or you want price controls.

With all due respect you should do some reading on the subject.

A good start would be "An Inquiry into the Nature and Causes of the Wealth of Nations" Published in 1776 by Adam Smith. He rose above this thinking 250 years ago!!!
 
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Basic rule of capitalism....make a profit for the shareholder. If you want government control of oil, go to Venezuela. Even Mexico is turning away from state control of Pemex and opening it up to corporations as the government there slowly destroyed the efficiency of the oil business.
 
I am sure the oil boom is employing lots of people making decent money. Which is good.
 
+1
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USA - we do oil pretty well. We sort of invented the whole industry and we sell the products world wide. Good on us.
 
Originally Posted By: ZZman
Why not keep it here to keep prices low and let people spend their money on other things?


What drives most everything in business, profit.

They are also selling natural gas. Which take a huge plant to compress and cool it to make it liquid.
 
Back when gas was $4+ a gallon my brother thought the government should step in and control the prices. After a short lecture on how economics work and how the free market sets prices, I told him that if didn’t like having to buy lots high priced gas, get a smaller car.
 
Originally Posted By: raytseng
These companies even those HQed in the US have no responsibility to do business with the perspectives of whats best for the US.

In fact, depending on who is at the helm, they may not care what is good at all - period. Higher profit is the only goal for some of these leeches.

Netflix Dirty Money.

You can be sure there are plenty of these bozos sprinkled across the oil and gas industries.
 
Originally Posted By: spackard
That's very naive - why not keep it here and keep prices low.


This law was tried and it was horrible for gas prices. It is cheaper to sell excess Gulf area to Mexico and abroad and import for Alaska, then to ship it across country or through the Panama canal. Remember California is bound and determined to shut down all industry in its state, especially anything oil related.
 
Oil and Oil-derived products like gasoline have a finite life after being pumped from the ground.

If you are producing (refining) petroleum products, you have to sell those products within a relatively short period of time ... for gasoline it's about 90 days, although you could probably get away with 120 days. Other products have different lifespans, but they all have limited lifespans ...for motor oil it has to be in a container within a specific time period, whereupon it can have a much longer shelf life. But that means you need to sell it to an oil company relatively soon after it comes out of the ground.

The old business method was predicated on leaving it in the ground, because it was believed that it would be "good forever". That way of thinking is changing; producers are beginning to fear they won't be able to sell that oil into the market in 20 or 30 years time. So they are pumping it instead.

The North American oil market is controlled by independent producers who own wells or well rights. Corporate owned wells are only about 30% of the market. So it's that 70% who determine how much wellhead oil is available at any given moment. These are basically landowners, mostly farmers and ranchers, with wells on their land. They decide how much oil is available. There is a self-controlling mechanism whereby they tend to close wells when prices are low and open wells when prices are high. Oil prices are relatively high now, so they are pumping more oil from the ground (and that is why the world price doesn't always reflect the pump price; for example when the world price is low, the supply is also low which drives up the pump price).

Take the above two factors together, and you have a large supply of perishable product, so it gets sold to markets outside the US when the total exceeds America's ability to use it in the short term.
 
So what I hear is profit and greed knows no nationalism or patriotism.

Hence some of the problem of large corporations versus private businesses when it comes to workers, communities etc.
 
Originally Posted By: ZZman
So what I hear is profit and greed knows no nationalism or patriotism.

Hence some of the problem of large corporations versus private businesses when it comes to workers, communities etc.


As was already mentioned, start your own oil company and run it with whatever Socialist ideals you like. If your business model is viable, it should be a great success.
 
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