I really hope you’re kidding. I can’t help but find this line of thinking terribly misinformed.

I’ve said it before and I’ll mention it again, I happen to be a geologist for a ‘mid-major’ oil company. We, in no uncertain circumstances, do not have any control on the price of oil.

We work within the price environment. If the price is high (as it is now) it allows us to drill more wells (mind you, I work for a domestic, on-shore, natural gas-focused producer). When times were lean, as they were not that long ago, this particular company (and countless others) didn’t do as much drilling. Wells don’t get drilled without a certain amount of confidence that they’ll turn a profit.

The primary criterion for deciding whether a well gets drilled is the rate of return. In other words, is the anticipated amount of hydrocarbons producible from this particular wellbore capable of paying off the drilling, completion, and production costs? A typical mid-con natural gas well can easily exceed $1M to drill (yes, drilling companies have jacked their prices accordingly – everyone wants a piece of the pie) and $1M to complete, and if a particular prospect doesn’t have the anticipated recoverable volume (today’s technologies allow for roughly 70% to 80% recovery from most natural gas reservoirs – expect less with low permeability/low porosity tight-gas formations) to pay that off within a reasonable amount of time (remember, we play with the time-value of money – we don’t instantly extract the hydrocarbons. It may take a decade or more to reach the EUR [estimated ultimate recovery] for a particular well) then the well doesn’t get drilled. Why go to all the expense on a venture that doesn’t offer the same ROR as a wise (and easier) investment elsewhere?

The irony is that higher commodity prices make marginal wells profitable – and thus hydrocarbons that would have otherwise stayed in place are produced. Every company is in existence for profit, mind you – why why drill the wells if there’s no profit to be made?

Sorry for the lengthy rant – I just get in a tizzy when I think about the uneducated opinion the masses hold regarding the oil and gas industry.

2. God, it must suck to be GM and Chrysler with their late-to-the-party muscle cars. At least Ford got in early, ate the good food, talked to the pretty people, had a nice drink or two and left feeling happy.

Ford’s sold Mustangs to all sorts of people: image buyers who’ll take a V6, gearheads, boulevard cruisers, anyone who could sacrifice some practicality for what is a nice-looking car. GM and Chrysler will get six months of mullet sales, tops, and then their cars will rot on dealer lots.

By the time it is all said and done we will be left with Ford/Lincoln and Chevy/Cadillac/Something.

Chrysler will be the American Subsidiary of Renault-Nissan before long.

In California at least there are three taxes on fuel: Federal taxes on a per gallon basis, state taxes on a per gallon basis AND sales tax as a percentage of selling price. Even though gallon demand is off very slightly in the state over the past year, I’m sure the total state taxes collected on fuel is up as the price has increased far more rapidly than demand has declined.

No, it doesn’t. Because:
1. Econ 101. Prices will move to equilibrium of supply and demand.
2. Common sense. Ever try to get thousands of businesses in/and dozens of countries to move in lockstep–and secretly?
3. Petroleum-related taxes are typically X per unit, not X per value. Higher prices lower demand (consumption), so tax revenue goes down too.
4. Politicians like voters to be happy, or at least content enough to re-elect ‘em.