Should the oil companies be de-privatised?

Question

It seems a bit crazy that oil companies are allowed to hold the governments and citizens by the balls like this. How can it be fair that oil is owned by whoever finds it? Surely a countries natural resource should belong to its citizens? I realise that this sounds a bit like communism but surely we've proven our current system isn't working?

Is there a good reason that the system is the way it is? If so, could someone please explain it to me.

Answer 1

who'll do this ven if u target just local suppliers and retailers, there is this sytem of lobbying and money for popular political support, they favour poor by the same money waived awy frm. them the better ord is citizen consciousness and incresing state control by acts, and agood bit of diif could be made at least state approved increase 4 domestic puposes and at gasoline pumps could b less...................................

we should also move towards alternative resources  to adjust to inc prices that will teach them a lesson,create a trend and once in large vols(they profit frmbut cant survive frm blk marketing alone, see?)force them to keep prices low and avoid black marketing as the case may be; speculators will b discouraged but lot more if we check that speculation and black marketing is out!

Answer 2

I wish things were so simple in economics and politicians. I have lived a better part of my life in an economic environment where all natural resources were owned by the Government/ the State and private sector was a small part of the economy. But this did not help in any way in terms getting quality goods in adequate quantities in relation to the needs of citizens at affordable prices. The govt. is the worst kind of monopoly that citizens have to contend with. The goverments are the most corrupt, most inefficient managers of natural resources. They exploit much more than private businesses. So, by de-privatization you would most likely to see  the citizen's interest hurt more.

In my country, petro products were always higher than the prices ruling in the US and the govt. tax constiuted 50-60% of the retail gas prices. We know how de-privatization serves the politicians and the bureacrats and how exploitative is such regimes for the citizens.

You must also remember that while in the advanced countries private oil companies have been dominating since oil was discovered, the price per barrel had gone up to $40 and then over the years gone down $15 and remained below $60 FOR LONG PERIODS. oNLY IN THST 4 YEARS OR SO the oil prices have been showing sharp and virtually continuous rise. This cannot be true that the private oil companies have just recently become greedy to raise the prices taking them $40 to $140 within a few years. The countries which have the bulk of the oil reserves have decided to make more money now. So the oilcompanies really do not own the oil in the OPEC Countries. Their govts do. They want to get fair value of the important mineral they own. You may say that oil reserves cannot be of individual countries and they are actually for the whole world but this would not accepted by the oil producng and exporting countries.

Please note that bulk of the price one pays at the retail level for petro-products goes to the countries which own the oil reserves, a small percentage of the price ic cost of production, a not so small percentage is accounted for by transportation and retail station owners margin and a small percentage goes to taxes (in some countries the State takes much higher percentage) and a small ercentage goes to the oil companies. When oil prices rise these private oil companies see their profits soar but that is more because of the volumes they handle rater than an extraordinry jump in their margins..

Had deprivatization worked, forget erstwhile Soiet Russia, China, India, Indonesia, would have had much higher per capita incomes than the US rather than being such poor as to do with a per capita income of less tha $2000 a year.

It would be better for advanced countries to concentrate on commercialisation of alternative and more efficient sources of energy and fuel and industrial materials so as to reduce their dependence on crude oil. In the coming years with huge population in Asia including China and India will be gobbling up increasing portions of the oil that the Middle east manage to produce.