Supply And Demand …… Two Of The Many Things Climate Lunatics Don’t Understand!!


It has always boggled my mind when the lunatics thought they were sticking it to big oil by advocating the decrease in oil production …… such as what they’re doing over the Keystone pipeline.  I’ve repeatedly try to explain to the lunatics the oil companies don’t care if they restrict production.  They simply raise the prices to match the availability.  Less oil and gas availability increases the profit margins of the oil companies …….. always!

The reason for this is as simple as one of the most basic economic principles ……. the law of supply and demand.  The cold hard fact is that the demand for oil is still growing.  And, it will continue to grow until there is a proper alternative.  Wind, solar, corn squeezins ……. none of them, even combined presents a viable alternative to oil and natural gas, or even coal.  As impoverished nations modernize, they demand energy, the cheaper the better! 

So, what happens when oil producing nations and big oil companies dramatically increase oil production?

Exxon profit falls by half but production rises

NEW YORK (AP) — Exxon Mobil Corp. profit dropped by half in the second quarter on sharply lower oil and gas prices around the world, but the company’s oil and gas production, which has been generally declining in recent years, surged.

The company posted net income for the second quarter of $4.19 billion, down 52 percent from $8.78 billion in the second quarter of last year. It was Exxon’s lowest quarterly profit since June of 2009, when the nation was in recession and oil and gas prices had plummeted.

Exxon’s revenue for the quarter of $74.11 billion, down 33 percent from last year, was also the company’s lowest since 2009.

On a per-share basis Exxon earned $1, down from $2.05 last year and less than the $1.11 per share expected by analysts surveyed by Zacks Investment Research. Exxon shares fell 4.7 percent to $79.15 in morning trading.

Lower global oil and gas prices hit all oil and gas companies hard in the quarter, reducing revenue and profit, and forcing most to reduce investment into new projects. Exxon cut its capital expenditures by 16 percent in the quarter to $8.26 billion.

The average price of U.S. crude oil in the second quarter fell by 44 percent compared to last year, and the U.S. natural gas price was down 40 percent, according to the Energy Department.

For the second straight quarter, Exxon’s U.S. exploration and production operations posted a loss, a surprise to some analysts who had hoped that the company would be able to cut costs enough to stem losses.

“The surprise really was here in the U.S.,” said Brian Youngberg, an analyst at Edward Jones. “You’d think production would have shown some improvement.”

Exxon’s refining and chemical operations, however, performed well, especially outside of the U.S. Together, the company’s downstream and chemicals earnings rose 77 percent to $2.8 billion, led by a 5-fold increase in refining earnings abroad. Refining and chemical operations generally perform well when oil and gas prices fall because it lowers the cost of raw materials.

And Exxon’s production of oil and gas, which has been declining in recent years, showed a strong gain for the second quarter in a row. Overall production rose 4 percent, and production of oil — which is generally more profitable than natural gas — rose 12 percent.

“Production volume growth has begun to show some traction and that is definitely a positive,” Youngberg said.

Exxon shares have decreased 10 percent since the beginning of the year, while the Standard & Poor’s 500 index has climbed slightly more than 2 percent. The stock has decreased 20 percent in the last 12 months.

You see, the lower the supply, the more they get per unit, the more supply the less per unit. 

Wanna stick to big oil?  Then advocate cheap fuel. 

In other words, you climate lunatics have been played for decades.  Idiot tools!

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5 Responses to Supply And Demand …… Two Of The Many Things Climate Lunatics Don’t Understand!!

  1. Latitude says:

    It’s always amazed me….where do they think they buy bio-fuel? Why do they think the big oil companies have invested so much in bio-fuel research?

    • suyts says:

      I showed lunatics where the big oil companies were the biggest investors of wind and solar ….. trying to show them the large energy companies don’t care how they make their money ….. The person I was showing took it as proof that oil was peaked.

  2. DirkH says:

    ( williambanzai7 )

  3. squid2112 says:

    Not to mention the simple FACT that it is cheaper and more economical to produce less. So, you reduce production, creating a more valuable product (by the barrel), and have to produce less of it to collect the same number of $$$. You are absolutely correct that oil companies not only don’t care that you reduce the production, they LOVE it! That is a major reason why oil and gas companies are generally on the side of AGW and various restrictions and regulations. The lunatics should ask themselves why a company would lobby for regulations against themselves. The answer, in most all industries is, because those regulations actually HELP their own profits! … duh!!! … We see it all the time in all industries.

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