"On the surface, it seems that Big Oil is pumping cash rather than petrol," Sen. Charles E. Schumer (D-N.Y.), chairman of the Joint Economic Committee, said at a recent hearing on whether to break up the major oil companies. He said that in 1993, the five largest oil refiners controlled a third of the U.S. market; by 2005, they controlled 55 percent, and the 10 largest held more than 80 percent. And he questioned why the major oil companies were buying back shares instead of investing more in refinery additions or maintenance.I completely agree with Senator Schumer but the answer is very clear. The breakdowns actually result in even larger profits. By limiting production you raise prices. It is the simple theory of supply and demand. The refiners do not need to invest anything into updating refineries. Each breakdown results in higher prices and increased profits.
"I don't understand how an industry that makes tens of billions per year can still have rusty refining plants that constantly break down," Schumer said. "And I don't know any other industry where an equipment breakdown in one company benefits every other company by raising prices."
It is that fact that is most troubling. Yesterday the Republicans rejected tax increases from big oil to fund renewable energy sources. Is there anyone reading this that can still claim that the Republicans are the party of family values? They are helping big oil rape the American consumer and damage the environment. Remember that when the price at the pump reaches $4.00 per gallon.