Could you please analyze my comments on the proposed windfall taxes for oil companies?

Question

The tax hike on oil companies reduces their operating profit margins. Therefore to combat this, oil companies will raise their prices or exacerbate cost cutting.

The oil companies are not the problem here, which every politcian thinks are. They are making a lot of money in a business where demand has grown and supply has been constrained. I question the role of the oil lobby in the last 20 years in the US for not seeking alternatives earlier. THIS SITUATION WAS ENIVITABLE.

People fail to realize the weakness of the dollar, as a catalyst for the price of oil. Oil is traded in US dollars around the world. With that said, as the dollar has skidded in the last 8 years to other world currencies, the price of oil has risen dramatically. To see the price of oil calculate the dollar adjusted price of oil in today's terms. It is shocking. We need a president who will support the dollar.

Oil co.s know that the world is trying to reduce oil consumption- What will profits be in 30yrs?

Answer 1

I agree with the above.

This same topic was mentioned by Mark on CNBC yesterday.

The commodity currency play is very clear. the correlation is easy  to see. You  are right in the windfall tax not helping prices. I believe the conept is that the tax would help fund alternate fuel research.

with regard to ur currency comment. Its a vicious cycle. Our fund is based in Europe and we see high prices so we must keep higher base rates. Comments on this by King and Trichet kill the USD relevant to EUR and GBP.

As tough as it might seem the only solution that I can think of to oil pirces is boost the dollar by means of fed interest rate hikes. This would hurt the housing sector but lower inflation. Welcome to the new world where Europe and the US are no longer they only big consumers.

Answer 2

your statements are true and well thought out. i do wish that auto and oil companies had pursued alternative fuel sources earlier since everyone was aware that oil is a limited natural resource, but since they did not we must pay for their mistake.

Answer 3

You have failed to mention what the definition of windfall tax really is, but I'm sure most of the readers here, like congress,wont know either.   The windfall tax would accomplish abolutely nothing to lower the price of gas except give a boost to the Liberals

You failed to mentioned that Congress has been blocking the oil companies from drilling in US terrortories.

In fact today, a motion in Congress was made that drilling in the Continential shelf would not accomplish anything - There happens to be at least 76 billion barrels of oil, but the Liberals in Congress don't give a rat's a..  

Your on the right track, but too many will not agree with you

The greatest enemy facing our country today is not coming from foreign soil it’s living among us, it’s not terrorisms it’s liberalism.

Answer 4

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Answer 5

The major US Oil companies only provide 3% of our countries oil. Our dollar is worth c**p internationally, so they want more of it. Stop the war, our dollar will slowly rebound, price of oil drops. Quite simple really, all the rest is a waste of your and my time.