# High oil prices - why?

**URL:** <https://boards.straightdope.com/t/high-oil-prices-why/310188>\
**Category:** Factual Questions\
**Created:** [June 28, 2005, 1:38pm UTC](https://boards.straightdope.com/t/high-oil-prices-why/310188 "2005-06-28T13:38:52Z")\
**Posts on this page:** 2\
**Page:** 2

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**Author:** ![ColonelDax](https://avatars.discourse-cdn.com/v4/letter/c/71e660/32.png) [@ColonelDax](https://boards.straightdope.com/u/ColonelDax)\
**Post date:** [June 29, 2005, 8:22pm UTC](https://boards.straightdope.com/t/high-oil-prices-why/310188/21 "2005-06-29T20:22:36Z")

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> [@Johnny L.A.](#):
>
> Speaking of China, i heard that China is trying to buy Unocal.

Correct. Chinese government-owned CNOOC Ltd. last week [offered](http://www.cnoocltd.com/cnoocltd/template/Template011.jsp?Wc_Id=554&Wg_Id=19) to buy Unocal Corp. for $67 a share in cash, or $18.5 billion. Unocal in April had [accepted](http://www.chevron.com/news/press/2005/2005-04-04.asp) a cash-and-stock bid worth $62 a share, or $18 billion including assumed debt, from ChevronTexaco Corp. (now Chevron Corp.), and that acceptance remains in effect. Unocal shareholders are scheduled to [vote](http://www.unocal.com/uclnews/2005news/062905.htm) on Chevron’s offer on Aug. 10.

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**Author:** ![saoirse](https://avatars.discourse-cdn.com/v4/letter/s/5daacb/32.png) [@saoirse](https://boards.straightdope.com/u/saoirse)\
**Post date:** [June 30, 2005, 12:23am UTC](https://boards.straightdope.com/t/high-oil-prices-why/310188/22 "2005-06-30T00:23:41Z")

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> [@Exapno Mapcase](#):
>
> Electricity, natural gas, and phone service were regulated because they were monopolies; i.e. for the convenience of customers only one of each service was given a franchise in any community. The government then stepped in to ensure that consumers had some protection against monopolistic practices, like price gouging.
> 
> Motor fuels were never given monopolies and so were allowed to compete in the marketplace. And now that competition has been allowed in electricity, natural gas, and phone service, those industries are no longer regulated either.

Just to expand a little: Gasoline arrives in tanker trucks, so the complex delivery infrastructure is simply piggybacked on the existing one (that is, highways). Your gas and electricity are delivered through pipes and wiring systems that were laid years ago by one company. Duplicating this infrastructure in order to compete in the market wouldn’t make much economic sense, so the PUC (or PSC, here) monitors these “natural monopolies.”

On the other hand, Exxon can build a gas station across the street to compete with Mobil.

Hang on a minute…

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