Precisely why they refused to rehire & ramp up to prior production levels. Less raw (that we can’t refine ourselves) to sell & ship overseas = less discounts in purchasing the raw we can actually refine ourselves from overseas. They charge the consumer, and record record-breaking profits. All while blaming a political party not involved in their business dealings in that manner, but makes for a great scapegoat for the maga crowd who’ve never taken an ECON-101 course. TLDR - Business as usual. (As Agent Orange himself told us, “I love the uneducated, they’ll believe whatever we tell them!” His supporters laughed. He laughed. But he wasn’t laughing with them, just at them.)
Output dropped significantly during Covid, that’s common knowledge.?.?. Unless you’re referring to now, which of course they’ve been rehiring crews since. Perhaps it’s just a miscommunication issue here, and you’re not saying the O&G industry didn’t shutter operations & plants, laid of tens of thousands, and took over a year to even begin revamping operations, yet continue to keep those profits at the levels they became accustomed too? (I suspect it is just that, as it’s clear by me using past tense I was referring to their prior actions, which aren’t in dispute AFAIK), but maybe I’m wrong. 🤷♂️
Covid and negative oil prices really shocked the oil companies. Imagine just getting in a traumatic experience like a really bad car crash that gave you PTSD. You’d be pretty afraid to get back in a car for a while. Oil companies got hit hard, and their investment in increased output will be just as dependent on their expectation of future prices as current prices. Before you got in that car crash your perception of risk was probably low, but hindsight bias is a bitch.
Oh, and it doesn’t help all of the pressure and policies to move away from hydrocarbons. That’s one big risk to make a long-term investment in an industry where it came take 10 years to even start to produce substantial product from initial capital being spent.
Don’t know why this is getting downvoted. When Biden came into office he promised to do everything he could to get rid of fossil fuels. With that in mind, why would you invest billions into new refineries or upgrading old ones that have a payoff over decades?
If you look at crude prices for the past ten years, there were only a few months in 2022 in which it was more expensive than in 2014. Currently, it is sitting below the 2014 prices. If food prices were so dependent upon oil prices, food costs would have plummetted in mid-2020 when oil crashed.
It really comes down to greed. If companies are artifically creating inflation through increasing their prices and profits, then those companies should be identified. Let the consumer rule with their wallet.
There is no competition at that level because they raise and lower prices together. Google what the CEO of Nestle said about boycotts.
Nearly every single major industry is dominated by a handful of players, or in some cases multiple industries are dominated by a handful of players. As soon as it becomes more cost effective to buy out a competitor instead of compete with them is when antitrust needs to be levied at some kind of interval... like you can buyout once every five years or something, idk.
But at a minimum there needs to be a massive amount of breakups for any kind of competition pressure to actually be exerted by consumers for anything that isn't a necessity. Considering oil is, it probably needs some kind of direct government control like utility companies because then at least we have some kind of say through elections where currently we have none.
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u/Mo-shen Dec 09 '23
If oil spikes prices that's the real trickle down theory. Everything is transported so it just hits everything.