Avoiding Middle East oil

The cynical side of me wonders how much Citgo stock Matt Holland owns.

Although you might get a warm fuzzy feeling because by buying only Citgo gas, you personally are not directly supporting Arab governments, it really doesn't accomplish anything. Arab governments will sell exactly the same amount of oil regardless of who you buy from.

There is more demand for oil than there is oil pumped from the ground, so every drop of oil pumped from the ground, regardless of who pumps it, will be sold to someone.

Venezuella can only pump so many barrels of oil a day. If everyone in the US decided tomorrow to only buy gas from Citgo, Venezuella wouldn't be able to supply the demand. The supply would ultimately come from the Arab countries anyhow.

The same is especially true when you consider gasoline in the US. Citgo can only refine so many gallons of gasoline a day. If everyone decided tomorrow to only buy Citgo gas, then the pumps would quickly run dry and Citgo wouldn't be able to keep them filled. So what would they do? They would by gas wholesale from Exxon-Mobil, Shell, and every other oil company out there to meet the demand. Every barrel of oil shipped from Arab countries to the US would be sold, it's just that it would all be sold by Citgo.

 

If this reverse boycott worked really well, so well Citgo sold more oil than they're currently pumping would they:

A - Declare a shortage and only sell what they pump
B- Raise their prices above market to handle their increased demand
C - Buy crude oil or refined gasoline on the global market (including from Middle East) to profit on their windfall.

My guess is C. I didn't include "Pump more oil" since they're limited by production quotas, pumping capacity, and market forces (the more you pump the more expensive it gets, since you use the easiest and cheapest supplies first).

Unfortunately with a global commodity product, we don't get much say on the supply... short of a government ban.

 

Boycotting one petroleum company or producing country in favor of another is not the answer.

The world's large oil supplies, in the US, Canada, Saudi Arabia, Nigeria, Indonesia, Venezuela, Azerbajani, Iraq, etc. are mostly in countries or regions that are unstable and/or are under governments of less than stellar qualities.

If we want to loosen the strangle hold that foreign oil has on our necks, then the US must attack the problem on several levels. Seeking alternate energy sources (wind, solar, nuclear) and making what we do use go further (conservation) would do the trick. Coal is too dirty to be a worthwhile answer, at least for the long term. Unfortunate, as the US has LOTS of coal!

But Americas don't want to cut back on consumption and the technology (and new power plants) that could make alternate energy affordable lie in the future.

People would conserve in response to extreme cost. Should we tax gasoline and bring prices up to ~$5/gallon? But yikes, we should have done that ten years ago and used the income to support energy research.

Sigh. We've brought all this onto ourselves.

Just quit using so much energy. If every American reduced their use by just 10%, our diplomats could thumb their noses at foreign powers trying to use oil as a bargaining club.

 

You have to boycott Venezuela too. They are no longer our friends because they elected a government that won't accept being told by the US what to do in their own country. B)

 

Most of these things are inaccurate. I've also heard that BP / ARCO are "British" and therefore don't use middle eastern oil. They do. The oil market is a world market, and companies routinely import and mix their crude depending on market conditions.

Snopes.com reports that while Citgo is a subsidiary of the national oil company of Venezuela, it does import "Arab" oil as well:

See the article at http://www.snopes.com/politics/gasoline/saudigas.asp for some background information.

You can also go to Citgo's home site (http://www.citgo.com) and click on "Investor Relations" to see that they are really a Texas oil company with "record" profits, just as Exxon-Mobil had "record" profits. Those of you who think record profits are a bad thing certainly want to find an oil company that is losing money, don't you?

 

Chavez is a nitwit who's done little for "his people" and lacks a serious mandate due to electoral shenanigans and boycotts by the major opposition parties and very low voter turnouts.

"Mr Chavez's "revolution" had little real impact on the lives of ordinary Venezuelans, who still suffer from chronic poverty and widespread unemployment despite the country's oil wealth." see: http://news.bbc.co.uk/1/hi/world/americas/3517106.stm

Buy Citgo is you want, but you are deluding yourself.

 

HooHaa...

Venezuela is part of OPEC. and oil is fungible. If we decided tomorrow that this was a good course and bought every drop of Venezuelan oil it would only mean that Venezuela wouldnt suppy vehicles in Europe, S America and other places. But Saudi Arabia would step into this void and replace the 'lost' Venezuelan supply.

Oil and money are freeflowing so this would do nothing to impoversh SA.

Now reduce our consumption in absolute terms by 30-40% and then we are accomplishing something. More Hybrids, more use of diesel, more and better mass transport is all right within our reach. In 5 years with good pressure a 40% reduction in consumption is feasible.

However.... Worldwide forces may negate anything we do here.

China is 5 times larger than the US and soon it will be the #1 auto market in the world. India is 3 times larger than the US and the middle class is well educated and booming. These two giants will control all wordwide resources for the next century. We and the West will be tag-alongs. If China decides that it 'needs' every drop of Venezuelan oil in order to feed all the vehicles it will be using then it will just bid the price up and take it all.

It's unrealistic to assume that if China wants to pay $100 a barrel for oil that we will only have to pay $60/barrel. Whatever China and India decide that they want to pay is what we will pay also. We better get the 40% efficiency in place soon.

 

Although I'm not particularly interested in politics, Chavez has threatened to cut off oil to us today.

http://www.usatoday.com/news/world/2006-02...ezuelaoil_x.htm
http://news.yahoo.com/s/afp/20060218/pl_af...at_060218024452

I'm not sure that buying from them is that much better than the Middle East.

 

Citgo, as a Texas based oil company, would simply buy gasoline from another souce then.