Is fuel prices in oil producing countries ALSO raised? & Why? Is there really a GOVT. subsidy for fuel?

Question

Question is why does an oil producing country need to raise its fuel price? How does a global fuel price affects oil producing countries, INFACT they actually rake-in more when the global price rises, right? Now , which country in the world, especially oil producing ones, gives subsidy to their fuel price? Malaysia is one such oil producing country, who raises 41% in fuel price and claimed it gives out fuel subsidy, now how far is this true?

Answer 1

I just watched CNN’s  international Channel(3pm EST), breaking  the news that oil price spikes again.  But the anchor and the reporter assert it is China’s diesel demand contributed to the hike.

Waited a sec !  It is already THIRD time I am hearing CNN’s assertion of China’s diesel demand. The first time was about two weeks ago. What’s going on?

Then, Israel’s-Iran-attack-drill news flashing back-------Which Was Just Happened This Morning !  That “unmistakable signal”  is surely an act to have a consequence of  oil supply disruption !  Why is it not reported as a oil spiking cause ? !

Time to scapegoat China again before a major offensive ? To verify, I went to CNN web site , there it is :

China hikes fuel prices http://money.cnn.com/2008/06/20/news/int...  

China to raise energy prices

http://money.cnn.com/2008/06/19/news/int...

But  nowhere saying that Israel’s-Iran-attack-drill  will unstablize the oil supply region, causing the oil  price up.

For Israelis Iran Strike Drill see

http://www.jpost.com/servlet/Satellite?c...

Answer 2

The problem is - they doesn't rise prices. Actually they just have limited supply of oil. But there are too many purchasers in row and they just sell to whoever will give more money.

Otherwise if they sell in accordance by sequence of who row then thy will face shortage of oil (because storage will deplete fast). so to avoid storage depletion they sell by rule of whoever-gives-highest-price rule. Your right is not to purchase if you don't need or don't agree to such price. Nobody will suffer from it. Oil will just go to someone else - though due to less competition between purchasers those who left will get oil cheaper.

current problem is that there are too many purchasers requiring higher and higher quantities - because of population growth, increase in production in another industries and increase in consumption - so there is higher demand for oil with limited supply.