In 1999, Saudi Oil Minister Ali al-Naimi publicly admitted that the all-inclusive cost of producing a barrel of oil in Saudi Arabia — which has the easiest-to-produce oil in the world — is $1.50. That is not a typo. A buck fifty.
Right now the world price is over $77 a barrel, and the country that has the most influence on that price is Saudi Arabia.
Worldwide, it costs most oil producers about $5 to produce a barrel of oil.
The oil industry is shamelessly gouging. Regardless of worldwide recessions, and regardless of the fact that any one of them could easily undercut their “competitors” and still make huge profits, not one of them does it. They charge whatever they can get because they will quickly sell all they can produce.
OPEC has us over a barrel. They know it and we know it.
- Excerpted from the book, Fill Your Tank With Freedom.