I think we both know, that as you say “what the market will bear” will keep prices the same. The oil companies would take in that oil, the oil offshore of Florida, the oil from Iraq, and anywhere else the oil fairy brought it to them, and still leave the price the same. They would take a five cent drop in taxes and maybe drop the price to the consumer by two cents.

In addition, every bit of bad news leads to another increase. We go to war in Iraq, the price goes up. War ends, the price remains up. New Orleans gets hit by a Hurricane, the price goes up. The refineries are brought back online, and the price stays up. Isreal fires some missles into Lebanon, prices go up. Isreal stops, the price stays up.

I am not talking politics here, just the fact that with no competition (five companies, but they are not competing on price) in the market, the price will remain high until they are forced to compete.

Burger King and McDonalds and Wendys are true competitors, changing their prices to compete with one another. The oil companies own the stations they sell to, so there is no competition on price. I can choose which gallon of milk to buy, but the station owners are stuck with one supplier, so it is not true competition. Can you see the difference and how it impacts the consumer? Five Standard Oils is the same as one Standard Oil.

I have only a minor comment to your great points. I think one may find with market forces that plays a less significant roll than . I think that the essential statement any political body gives to the motive force is a confidence/trust (or lack, thereof) in Rule of Law. That’s it…

A simplistically-worded example is China, which separates its economic policy from its political policy/government type. It’s well known that its government is at odds with America’s in philosopy. Yet, here, market forces are undeniably strong. And, it is China’s huge thirst for oil (as compared to as little as 15 years ago) that is adding “fuel” to this sector of market (motive) force.