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Originally Posted by Brucelee
That MAY be the cost of procuring the oil to gas. The second question is how much should it sell to us for?
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OK now you open up a whole new can of worms...
Crude Oil is traded as a commodity and therein lies the problem. As a commodity, it's price is based primarily on Investor Confidence - confidence that an Investor can buy it and then later sell it at a profit !
Geo-political environment and events play a much greater role in establishing this Investor Confidence than do Supply and Demand (though these too play a lesser role).
Having it commodity-based allows for much greater manipulation of the price than if it were simply a raw material bought and sold as such. There is no way of setting a price of how much it
should cost us... only what we're both willing and
able to pay.