Re: Drug Company profits

[Steve Rack <srack@xxxxxxxxx>]

Oil refiners add a percent mark-on to the price they pay for crude.
When the crude price goes up, so does the price for refined product.
It used to be that refiners such as Exxon, Chevron etc. were also in
the drilling business. Now they are mostly broken up into
"independent" companies.  I wonder just how "independent" they are.
Steve

> I guess both drugs and energy have a rather inelastic demand ie. a
> small shortage drives the price up very steeply, which is what we are
> seeing now in energy. An interesting sidelight is something I heard
> today on NPR (National Public Radio). The statement was that the oil
> companies do not control the price of their product, it is the commodity
> traders. So the oil companies apparently have only limited control of
> the prices. I have wondered why the oil companies cannot be public
> minded and cut the prices; apparently they cannot because the traders
> drive the price up or down depending on the available supplies. So the
> oil companies now enjoy exorbitant profits because of the shortages.
> Create a shortage ....
> K. F.
>
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