It is just the size of the populations and the management of the oil The thing you have to realize about Venezuala and Nigeria is that they have a ton of oil, but it is mainly large oil companies that benefit from it. Everything is outsourced, those two countries do not actually handle the oil themselves. Venezuala in particular.. almost all the money goes to overseas companies, not to the government of Venezuala. Saudi Arabia runs everything themselves, the government is basically a large oil company, that is completely different than the other places where everything is contracted out.
Oil companies should get a majority of the royalties, since they are taking all of the risks and spending all of the money. Plus, they always run the risk of some of these foreign dictators nationalizing on them.
Well in the case of Venezuela, Russia and Nigeria, they are already completely nationalized. Yeah, there is a risk of the gov´ts actually moving in and forcibly taking over the wells and the equipment, but I think the dictators/Presidents realize that would be both a short term and long term disaster. I agree with you, the companies should be the ones making the most money, it is their investment, their expertise and their risk that is getting the oil out of the ground. If the Ven or Nigerian gov´ts had to actually construct a business like Saudi Arabia, they would have 5 years of no production because they don´t have the companies or the experts to do it, which is why they outsource everthing to us. I was simply answering the question ´why are Venezuala and Nigeria so poor if they have so much oil´... and the answer is that the profits are going to other companies.
When the price of oil was deregulated by our president some years ago. we were so glad to feel the fluctuating price of oil in the world market. From a high of 54 pesos per liter (mostly due to the regulated system of oil pricing) it was down to 34 pesos per liter early this year. But now it is inching up a bit at 42 pesos per liter and fluctuating beautifully in that vicinity. But if the world prices, as predicted in this thread, would push up and up, I am hoping that it will not go back to that level of 54 pesos per liter because definitely our economy will be greatly affected.
There is just too much production. Russia, Nigeria and Venezuela are all having major financial problems and oil is their biggest income.. they are all pumping as much oil as they can. The USA has become oil independent and is creating new technologies to increase production. OPEC basically does not exist anymore since everyone is breaking production guidelines. Iran is coming to the marketplace very soon. And on a demand side, the EU is not doing so great and China´s growth is slowing down. Other than a war, we are not breaking 70-75 in a few years.
