The price of oil has dropped down to $70 a barrel, yet we are still paying through the nose at the bowser.

Are our governments so helpless that they cannot do anything about this situation??

After all it is our country so surely our governments can grab these oil companies by the ear and force them to pass on the reduce oil price to the bowser.

Have our past leaders allowed our country to be put in a compromising postion and left to the mercy of wealthy companies??

magpie2

'Have our past leaders allowed our country to be put in a compromising position and left to the mercy of wealthy companies?'

I would say it is our incompetent current Government who promised to bring prices down at the last election when the price was $130 a barrel. Even given the exchange rate we can see that LAbour is more about rhetoric than anything else.

It costs $5.00 US to extract a barrel of oil and probably another $5.00 to refine it.Each barrel produces 80 litres of fuel and the by products we use for plastics etc.So it costs them 12.5c a litre to produce and we are paying 150 c a litre at the bowser.Someone is making 1200% or twelve times the production price per litre.

Back in the early 70'S the US had the major oil producers sign a contract whereby all oil purchases were to be made in $US.This is why the $US remains strong even with the demise of their economy.The rest of the world is paying a price for their excesses.

Saddham a US generated dictator threatened to flood the world with cheap oil,this would have destroyed the value of the $US but made our lives a lot easier.Iran presently threatens to likewise and that is why the US sees them as terrorists of the highest order.66% of the world's known oil resources are in Iran,Iraq and Saudi Arabia.Are we that naieve and stupid?

Sorry Arjay...I call shenanigans. Oil production costs are oh so much higher.

2005 figures for the US estimated crude oil costs at 53% of the cost, taxes at 19%, refining costs at 19% and distribution and marketing at 9% (source: http://www.eia.doe.gov/pub/oil_gas/petroleum/analysis_publications/primer_on_gasoline_prices/html/petbro.html).

The Northern territory Govt publishes a similar breakdown which shows refining costs at 53.6% (including the crude oil cost), Fed Govt Excise at 25.2%, the GST at 8.4% and margins at 12.7% (Margins includes transport/ distribution costs and wholesale and retail margins) (source:http://www.nt.gov.au/ntt/economics/publications/economic_briefs/petrol_pricing_dec07.pdf). That is, in Oz, taxes make up a little over a third of the price.

Also, Iraq, Iran and Saudi Arabia have more like 45% of world oil reserves, but somewhere around 34% of production, with the combined team of USA, Canada and Mexico coming in at around 18.5% of reserves but 22.4% of production. As of 2007, Russia rivalled the Saudis for production, but has less proven reserves. (sources include: http://www.eia.doe.gov/oil_gas/petroleum/info_glance/petroleum.html).

I don't mind debates, but I much prefer ones with a hint of fact.

Amjay,taxes and charges are not costs,this the middle men making a cut.It costs between $3 and $5 to get a barrel of crude oil from the Middle East out of the ground.There are enormous profits being made and neither you or the oil companies can deny the reality.Don't forget that from the 80 litres of fuel they have another 78 litres of by product than is turned into plastics, paint and numerous other products.Paint for example retails for at least $25.00 per litre.
Which oil company do you work for?

Much or the cost of pertol is in the processing of the oil and not the cost of getting it out of the ground.
50 per cent of the retail cost is TAX.