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Pity the Poor OPEC Members; at $47 a Barrel They Barely Make a 5,000 Percent Profit

AUTO CENTRAL - December 2, 2008: Early Tuesday morning news was released that oil has dropped to a 3-year low to just $47 per barrel. So what does that mean, say for example, to the Saudis? Well, it cost the Saudis a bit less than one dollar to suck a barrel's worth of oil from the ground. So, at $47 they make a profit of more than 4,700% for each barrel. It's hard to imagine how King Abdullah and his cronies could continue to live the style they do while helping to fund world terrorism with so little margin.

Recently, King Abdullah was quoted as saying that he thought $75 per barrel was "a fair price." Yeah, fair, if your main occupation for centuries was raiding caravans.

When oil was $100, the Saudis made more than 10,000% profit. When it was $140, they made 14,000% profit.

By comparison, the jewelry trade has one of the highest markups over their cost of goods; often a retailer or wholesaler might have a "double" or "triple keystone." That means 200% or 300% profit. If the OPEC members only made a double or triple keystone, oil would cost about $2 or $3 per barrel. THINK ABOUT IT!

This is why we must get off the gasoline standard right away. Given the opportunity the Barbary pirates would run the price of oil back up over $100.