Big oil rakes in massive profits
Bloomberg analysts point to the boom-and-bust nature of primary goods, like oil, which can experience high levels of price volatility. When the pandemic began, oil prices fell quickly, and now they are reaching record highs, driving up prices for other goods in the market.
Traditionally, when oil profits are high, capital expenditure to increase production typically increases.. but this time many tracking the actions of Big Oil are not seeing that happen.
Without these increased investments in capital expenditure to increase production, consumers could face high prices for some time. This year, Exxon Mobile is expected to spend around $24 billion on capital expenditure, which is equal to their earnings just in the third quarter of this year. Many looking at this picture believe that this just will not be enough to bring prices down.
