An Analysis of Oil Industry Profits and Behavior

If one thing was made very clear by the actions of big oil in the summer and fall of 2005, it was that they have succeeded in making themselves alot of money.� Billions of dollars.� Exxon Mobil by itself made almost 10 billion in the third quarter, the most by any corporation in any industry in all of history.� The other major oil companies were not far behind.��

Why then?� Why�were profits so huge in the third quarter?� Was it because there was suddenly a leap forward in the production process that meant it cost less to�produce it?� Was it because they sold alot more of it?� Or was it because they took advantage of short term shortages caused by supply disruption to ramrod the prices as high as they could?� I�am leaning toward the latter.� They saw an opportunity to make�truckloads of money with little chance of repercussions.� "What the market will bear"� as they say.���