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How we can stick it to OPEC
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Hater Depot



Joined: 29 Mar 2005

PostPosted: Wed Nov 23, 2005 5:20 pm    Post subject: How we can stick it to OPEC Reply with quote

By forming a buyers' cartel to counter their sellers' cartel.

http://www.slate.com/id/2131024/

Quote:
But what if big oil buyers did to cartel members what they have been doing to us for decades: use their concentrated market power to influence prices? Sen notes that the world's 10 largest oil importers—the United States, Japan, China, Germany, South Korea, France, Italy, Spain, India, and Taiwan—imported about 32.6 million barrels per day in 2004, almost exactly what OPEC produces. Oil prices are high precisely because of the growth in these importing countries. And the more we grow, the more oil we'll need, and the more cash we'll ship to OPEC.

The cartel would purchase 32 million barrels a day at a price it names and deems to be fair—the producers' cost of production plus some profit. We can't expect the Saudis to give it away at cost, after all. But ultimately, the market would still set the price of oil, as refiners, companies, governments, and traders compete to buy crude. OPIC could offer to buy OPEC oil at $20 per barrel, and then these other entities would buy it competitively from the cartel. Let's say that market price settles at about $50 per barrel. Instead of flowing into coffers on the Arabian Peninsula, that $30-per-barrel rent would be split among OPIC member governments proportionally according to consumption. Domestic OPIC producers would continue to produce oil as they wished and sell it into the larger market.
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Wangja



Joined: 17 May 2004
Location: Seoul, Yongsan

PostPosted: Wed Nov 23, 2005 5:30 pm    Post subject: Reply with quote

Or reduce demand?

Pricing petrol (gasoline) at realistic levels - around 8 USD a gallon - would reduce demand in US by, at a guess, 60%. This increased tax - around 6 USD a gallon - would also go some way to paying for the "stabilising" forces in the oil production areas.
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Ya-ta Boy



Joined: 16 Jan 2003
Location: Established in 1994

PostPosted: Wed Nov 23, 2005 5:57 pm    Post subject: Reply with quote

Quote:
By forming a buyers' cartel to counter their sellers' cartel.


Isn't there a flaw in this? It's probably much easier for Saudi Arabia, for example, to go without a sale for a few days than it is for South Korea, for example, to go without an oil shipment.

Besides that, declaring economic warfare does nothing to address the core issue: over-dependence on a limited resource.
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Kuros



Joined: 27 Apr 2004

PostPosted: Wed Nov 23, 2005 11:23 pm    Post subject: Reply with quote

Wangja wrote:
Or reduce demand?

Pricing petrol (gasoline) at realistic levels - around 8 USD a gallon - would reduce demand in US by, at a guess, 60%. This increased tax - around 6 USD a gallon - would also go some way to paying for the "stabilising" forces in the oil production areas.


8 USD a gallon is far too much. You'd be squeezing the life out of the American poor. Remember, to get anywhere in America (and I mean this in a simple spatial sense) you need to drive.

I think 4 USD gallon would hurt in the short run but provide some real incentive towards changes in the long-run.
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Ya-ta Boy



Joined: 16 Jan 2003
Location: Established in 1994

PostPosted: Wed Nov 23, 2005 11:32 pm    Post subject: Reply with quote

Quote:
Remember, to get anywhere in America (and I mean this in a simple spatial sense) you need to drive.


Just to give an example: My mom lives 10 miles from the nearest grocery store--and it is small. She lives about 15 miles from the nearest 'real' grocery store. There are no buses or trains. A car is the ONLY way to get there.
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hypnotist



Joined: 04 Dec 2004
Location: I wish I were a sock

PostPosted: Fri Nov 25, 2005 9:13 am    Post subject: Reply with quote

How about investing in public transport now, whilst slowly edging up the price of 'gas' to realistic levels?

Are Americans allergic to it, or something?
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Ya-ta Boy



Joined: 16 Jan 2003
Location: Established in 1994

PostPosted: Fri Nov 25, 2005 10:40 am    Post subject: Reply with quote

Quote:
How about investing in public transport now, whilst slowly edging up the price of 'gas' to realistic levels?

Are Americans allergic to it, or something?


Clearly, public transportation needs to be improved, but it is a lot more complicated than that.

I come from a state that is approximately twice the size of South Korea but has slightly under 3 million people, spread out on farms and in small towns all across the state.

What form of public transportation is feasible in that situation?
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mindmetoo



Joined: 02 Feb 2004

PostPosted: Fri Nov 25, 2005 4:34 pm    Post subject: Reply with quote

hypnotist wrote:
How about investing in public transport now, whilst slowly edging up the price of 'gas' to realistic levels?

Are Americans allergic to it, or something?


Absolutely.
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Wangja



Joined: 17 May 2004
Location: Seoul, Yongsan

PostPosted: Fri Nov 25, 2005 4:49 pm    Post subject: Reply with quote

Ya-ta Boy wrote:
Quote:
How about investing in public transport now, whilst slowly edging up the price of 'gas' to realistic levels?

Are Americans allergic to it, or something?


Clearly, public transportation needs to be improved, but it is a lot more complicated than that.

I come from a state that is approximately twice the size of South Korea but has slightly under 3 million people, spread out on farms and in small towns all across the state.

What form of public transportation is feasible in that situation?


America is by no means unique in having remote rural population cut off except by car. Whether it is 50 miles to the nearest town or 10 miles makes no effective difference if there is no bus.

Wait, I take that back: 10 miles there and back you could do on horseback, 50 miles would be too much in a day by horse.
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dulouz



Joined: 04 Feb 2003
Location: Uranus

PostPosted: Fri Nov 25, 2005 6:36 pm    Post subject: Reply with quote

Would it be patriotic for Ya-Ta's mom to move where she could use
public transportation?
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hypnotist



Joined: 04 Dec 2004
Location: I wish I were a sock

PostPosted: Fri Nov 25, 2005 6:52 pm    Post subject: Reply with quote

Ya-ta Boy wrote:
Quote:
How about investing in public transport now, whilst slowly edging up the price of 'gas' to realistic levels?

Are Americans allergic to it, or something?


Clearly, public transportation needs to be improved, but it is a lot more complicated than that.

I come from a state that is approximately twice the size of South Korea but has slightly under 3 million people, spread out on farms and in small towns all across the state.

What form of public transportation is feasible in that situation?


But, but, but. The rural population of the US is what, just over 20%? And yet 25% of America's population have no access to public transport and around half only very limited access.

I don't know of any country with 100% access to public transport. But even in the towns and cities of America (with a few notable exceptions) public transport is just nowhere to be found.

And what happens to people when they're too old to drive?
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Hater Depot



Joined: 29 Mar 2005

PostPosted: Sat Nov 26, 2005 10:42 am    Post subject: Reply with quote

I think the US rural population is much closer to 50%. Declining though of course.
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bucheon bum



Joined: 16 Jan 2003

PostPosted: Sat Nov 26, 2005 11:08 am    Post subject: Reply with quote

eh no. 17% of the population is in rural areas.

http://www.demographia.com/db-usa-staterural.htm
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JongnoGuru



Joined: 25 May 2004
Location: peeing on your doorstep

PostPosted: Sat Nov 26, 2005 11:31 am    Post subject: Reply with quote

I've been to America before, so I'm an expert, yes I am. Cool

If you're thinking that putting in bus routes for America's rural population is going to make a difference, you know less about America than the Guru does. Anyone besides myself ever been to some of their cities? And I don't mean just the big scary ones that we all sort of knew were big and scary, but ... Albuquerque???? Do you know where Albuquerque is? (And who besides me knows how that's pronounced?) I didn't, until I went there for a convention. And when I asked my hosts for a bus map, they all gave me this big Shocked and Rolling Eyes . I eventually did get a map of the city finally, and they showed me where the "safe areas" are (30% of the city), the "no-go areas", and there wasn't anybody who didn't warn me AGAINST using the bus system for however short a journey. I ended up having to have people drive me around the whole time.

Great. Jack up petrol prices, tax the driving public mad. But if you can't make the existing bus systems -- even those in the cities -- a safe option, then admit that this is nothing more than mean-spirited social engineering. I don't care how much you tax people, you cannot force them to place themselves in harm's way. They'll rebel and vote you out of office.


Last edited by JongnoGuru on Sat Nov 26, 2005 8:36 pm; edited 2 times in total
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Rhoddri



Joined: 26 Jan 2003
Location: Seoul

PostPosted: Sat Nov 26, 2005 11:55 am    Post subject: Reply with quote

When you ask: "how do we stick it to OPEC", I think you miss one big factor: oil companies. Of course, there is a lot of geopolitics involved, the Yom Kippur war in 1973, the revolution in Iran etc...

There were a few people claiming before the Iraq invasion that one of the major reason for going to war was to abolish OPEC. The idea being that, with Iraq free from the OPEC cartel, they could underprice nations therfore introduce more competion between oil rich states (many in OPEC states, encouraging them to leave the OPEC union), hence bringing oil prices down.

There's one thing that oil companies don't want, and that's lowering prices. It doesn't matter where oil corporations were chartered, they focus on the bottom line, and to abolish OPEC would mean compromising profit.

There was an opportunity to free Iraq from OPEC, but it hasn't happened. The oil lobby in London and Washington is very powerful. And, as we have to understand, lobby groups contribute hugely to political parties and political campaigns. They don't do this because they believe in the merits of any random party, they back political parties which they believe will give them the freedom and opportunity to aquire the highest profit. When parties accept their donations, they have to find some way of making them happy. Record profits for BP etcetc would seem to suggest that the oil corporations are more than happy..

Of course it would be better for countries with oil deficits if OPEC was abolished, but not for the oil companies that may have been chartered in those countries.

Political decision have, and are increasingly becoming, dictated by powerful lobby groups, or "think tanks" camped in Washington and London.
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