Tilted Forum Project Discussion Community - View Single Post - Where is the oil/gas you are buying originating from?

BigBen · 01-16-2006, 07:46 AM

Three states away? Try three countries away, in most cases.

As a commodity market, you don't get to choose where your product comes from. There is no location identifier to differentiate from.

I can understand where you would be willing to purchase domestic oil at a premium, to make a political or philosophical statement, but may I also ask: What is your choke price? Would you be willing to pay double, or just a few cents more?

Oil is categorized by its grade (heavy, sweet crude) thus telling the buyer how easy it will be to refine into consumer goods. It is also paid at a delivery point, that is to say, all transportation costs are included. This creates a fairly homogeneous product, and the free market loves homogeneous products. You want to stir up that market by adding in another variable.

01-16-2006, 07:46 AM	#6 (permalink)
BigBen Comedian Location: Use the search button	Three states away? Try three countries away, in most cases. As a commodity market, you don't get to choose where your product comes from. There is no location identifier to differentiate from. I can understand where you would be willing to purchase domestic oil at a premium, to make a political or philosophical statement, but may I also ask: What is your choke price? Would you be willing to pay double, or just a few cents more? Oil is categorized by its grade (heavy, sweet crude) thus telling the buyer how easy it will be to refine into consumer goods. It is also paid at a delivery point, that is to say, all transportation costs are included. This creates a fairly homogeneous product, and the free market loves homogeneous products. You want to stir up that market by adding in another variable. __________________ 3.141592654 Hey, if you are impressed with my memorizing pi to 10 digits, you should see the size of my penis.