Why would oil companies risk billions of dollars in exploration, drilling, infrastructure, and refining capacity, all for the privilege of charging less money for their products?
Do you know the difference between profit and profit margin and more importantly do you know what the average profit margin the oil companies work with? The real issue is what I alluded to regarding the Saudis. Here's a hint, their profit margins are HUGE and where domestic production has to deal with OSHA,higher wages for the American worker and of course the ever present pestilence of unions, the Saudis can always have better control of the price. Still, when speculators can roll the dice by only exposing six cents on the dollar, we are going to have a volatile market. Also, higher prices recently are due to the huge decline in the dollar's value (about 30%) and of course we pay almost fifty cents/gallon to the Feds in the way of taxes. Bottom line still remains, drill here, drill now, pay less.
