Quote:
Originally Posted by echomodder
There's only one way to bring this "oil dot.com" bubble down. DRILL FOR MORE OIL! Even comming out and saying it will help, due to the fact why should the oil producing country's pump out more oil. A barrel out today's worth $140 3 months from now it will be worth $160. 3 months to get $20 more dollars I'll take that bet. If they here that the US will be drilling for more oil than they will pump out more oil to try to sell it for the higher price and that will in turn lower the price of oil.
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Oh no ... that is not the answer, from what I have read, oil companies have not even begun to maximize the current oil contracts they have for drilling. And for one simple reason, there aren't enough refineries to convert crude. SO then make more refineries right? Well, it takes years, I believe 5 to complete a refinery then set it up and make sure its working at capacity.
So then why not increase production? Because strick laws monitor the production of oil, not its quantity, but the equipments maintenance. Pieces need to be shut down and serviced at specific intervals making any refinery less than 100% capable of making oil and gas, etc.
So having more reserves will not solve this, and building the facilities to refine will take more time than the economy can currently handle. There is currently alot of demand and no easy way to solve the problem. Heck do you think the suppliers will cut back on profit in order to help those of lesser means? How do you think Chavez can afford to keep the price of gas down so low locally? Because demand is so high everywhere else ...