If oil is a commodity then why do people say the oil companies are to blame to fuel prices.

Question

Seriously .....Oil Companies have nothing to do with setting the fuel prices. It is Wall Street speculators that set how much fuel is going to be worth , then State and Federal Taxes are added on top of it.

So why do people continue to blame Big Oil, when they have absolutely nothing to do with the set price.

With Commodities the companies do not set the prices.

Answer 1

It's called 'Scapegoating".

Answer 2

They need an escape goat for the real reasons . If they did tell the truth  there would be a revolution .

Answer 3

Meg you are so off base, and you have a Wikipedia Article as a basis for your argument? When the h**l did Wikipedia become a Valid Source of Factual Information? Yes it does contain many articles that are right, but it also contains articles that are not fact and based upon opinion. I never take anything from Wikpedia for fact.

And you said Oil companies are limiting on oil production? No they aren't they are producing as much as they possibly can and it has been proven time and time again. If they can only take so many millions of barrels a day, then how can you expect them to bring X More Millions?

Please leave your Liberal Propaganda at a Liberal Blog.

Answer 4

It's easier to blame the oil companies than to learn, and to study, and to discover the real reasons that oil is expensive.  Yes, the oil giants have big profits.  But their 'margin' or, the percentage of profit as a percentage of total sales, is not nearly as high as some other kinds of companies.  Their total $$ sales figures are high, so the profits look high too.

The real culprit behind high oil prices: the booming economies of China, India, and other 'third-world' nations that are taking their place in the industrialised world and are seeking a lot of oil.

Answer 5

Speculators play a very small roll in the price of oil, especially when compared to good 'ole supply and demand, but people blame oil companies out of ignorance.  It is scary :-(

Answer 6

Oil in a non renewable natural resource, not a commodity like corn of wheat.  In is  in the interest of   companies to limit production  to maximize profits (that is  to collect economic rents) and there is every reason to believe they are doing so. Here is the theory

http://en.wikipedia.org/wiki/Hotelling's...

Answer 7

Its not totally due to speculators.  Speculators have played a role in the prices being high, I agree with you.  They do play a role.  Especially since when tension is high, prices will go up.  So I do believe they have some effect.  Nevertheless, its not largely because of them.  Other factors, like lowered supply/producing less oil has occurred too.  Sure, the Iraqi war and greedy companies may have played a role, but decreased supply is a much bigger reason.  Also, there is another factor in this problem too.  Part of it involves so much dependence on oil.  So, there is high demand for that.  Oil is in very big demand, esp in India and other countries.  So many nations are growing and people need gas- its foreseeable.  China for instance is growing so its need for gas has grown.  So there is much need for it.  As a result, demand soars up.

I blame big oil somewhat but I blame other factors more.  Demand is the one I blame the most.  So is supply.  We must invest in alternate energy and use increased clean energy- that's how we'll stop needing oil that much and quit depending on it [drilling isn't a helpful solution].

Answer 8

People say it out of ignorance.

U.S. presidential candidate Barack Obama termed Exxon's earnings "outrageous" and called for an end to the "tyranny of oil."