Gasoline prices and the government

[Dogmeat]

I don't think so.
They pump the oil, the big 5 produce the gas. take Iran, they are (I think) the number 2 or 3 producer of oil. They aren't getting rich like the gas makers are. The profit isn't really in the "oil", it's in the gas itself

I am sure Kin Saud is a VERY rich man, however, he sells his oil all over the world, not just the US. The big 5 makers of Gas in the US are making obsene profits, based off gas prices, not really oil. If you take the top 5 gas makers and add up all their profits, they made more than most of the countries in the world last year.

http://www.eia.doe.gov/pub/oil_gas/...ons/company_level_imports/current/import.html

It looks to me like we're getting the vast majority of our imports from Canada, then Saudi Arabia ... and on down the list.

We do import more oil from non-OPEC countries than OPEC countries, so I was wrong about this.

However, I still think there's more to it than just "blame Exxon" ... I'm still doing some research, but what I wanna find out is what, for example, the total production for 2007 was for instance, from OPEC countries Vs. Non-OPEC countries ... That would be a good indicator of how much leverage OPEC has in setting crude oil prices.

I guess i've just been under the impression that whatever OPEC wants to charge for crude, they do ... and since the price of a gallon of gas, at least according to the EIA is ~%50 of the total cost of that gallon, when crude shoots upf or whatever reason it' reflected at the price at the pump ..

I don't know, I'll do some more research ... I just have a hunch there's a lot more to this than the age-old "blame the oil companies" bit ...

But then again who knows, maybe there isn't ... heh

 

[Good to Go]

http://www.eia.doe.gov/pub/oil_gas/...ons/company_level_imports/current/import.html



but what I wanna find out is what, for example, the total production for 2007 was for instance, from OPEC countries Vs. Non-OPEC countries ... That would be a good indicator of how much leverage OPEC has in setting crude oil prices.


I just have a hunch there's a lot more to this than the age-old "blame the oil companies" bit ...

Try this

Or this

There's ALWAYS more to it...

 

[winter brew]

Ahhh.....so it's those greedy Canadians that are behind the high fuel prices!
Getting even with us for the higher sled prices?
I understand the big oil companies run about a 8% profit.....most companies would be out of business. Big numbers don't always mean big profits, it's all relative.

 

[Snow Fox]

What I would like to know is why diesel is more expensive than gasoline, though diesel is cheaper to produce. Gasoline has to be refined more than diesel, so shouldn't the price of diesel be lower? It comes down to one thing, and that is greed.

 

[Sturgis Sledder]

Ahhh.....so it's those greedy Canadians that are behind the high fuel prices!
Getting even with us for the higher sled prices?
I understand the big oil companies run about a 8% profit.....most companies would be out of business. Big numbers don't always mean big profits, it's all relative.

Agreed to a point but when Shell posts a $27.5 BILLION profit and Chevron posts a $18.7 BILLION profit they are hardly looking like they could go out of business.

 

[HawkShot99]

Agreed to a point but when Shell posts a $27.5 BILLION profit and Chevron posts a $18.7 BILLION profit they are hardly looking like they could go out of business.

Before I say anything, let me just say that I wish gas was cheaper.

However The profits that the gas companies are making are not that great. Exxon Mobile had the highest profits in 2007. Don't remember exactly what they were. However there PROFIT MARGIN was only 10%. So to make $1 profit they had to spend $10. That is pretty crappy for a business.

How many of you business owners on here would survive on those margins?

 

[Sturgis Sledder]

Before I say anything, let me just say that I wish gas was cheaper.

However The profits that the gas companies are making are not that great. Exxon Mobile had the highest profits in 2007. Don't remember exactly what they were. However there PROFIT MARGIN was only 10%. So to make $1 profit they had to spend $10. That is pretty crappy for a business.

How many of you business owners on here would survive on those margins?

From Dictionary.com
Profit - the monetary surplus left to a producer or employer after deducting wages, rent, cost of raw materials, etc.: The company works on a small margin of profit.

It doesn't matter how much they spend, they end up with $27.5 BILLION at the end of the day. A record profit as a matter of fact. i.e. they MADE more than they spent ! ! !

 

[buck50]

Ahhh.....so it's those greedy Canadians that are behind the high fuel prices!
Getting even with us for the higher sled prices?
I understand the big oil companies run about a 8% profit.....most companies would be out of business. Big numbers don't always mean big profits, it's all relative.

it does when they are making RECORD profits!!!!!!!!!!! remember the meaning of the word! that's how much they have left after everything they do is PAID for!!!!!! if my company was only making a 1% profit margin, most companies would be belly up in no time. but it IS relative. smaller companies need to have larger profit margins just to make ends meat, but massive companies don't really need as big of a margin because they are dealing in such huge amounts!!! if 1% was equal to $1 billion, not too many people, or companies would b!tch. and neither would big oil, except the spotlights are on them now, and they have to try and come up with some kind of answer!!!!!!!!!

 

[ruffryder]

it does when they are making RECORD profits!!!!!!!!!!! remember the meaning of the word! that's how much they have left after everything they do is PAID for!!!!!!

Not sure if I understand this. You think that a company that keeps on selling more of a product every year won't increase profits every year? I make a record profit every year too, been doing it for the last 5 years, so does that make me evil? Aren't we using RECORD amounts of oil every year too?

 

[bigfoot]

While everyone is going after the oil companies and profits, you really need to step back and take a look at the governments cut and revenue generated by gas taxes. They make the oil companies and their profits look minor league. I read the feds pulled in 1.2 trillion dollars in gas tax money last year, then you have state and local taxes on top of that, who is really the bad guy here? At least the oil companies make a quality product we can use, what are the feds doing with their 1.2 trillion?

 

[winter brew]

I too wish fuel was cheaper.....but let me play the devils advocate here. If YOU decided to go into the oil refinery business, what would your goal be?? Would you tell yourself "oh, I will just try to get by and provide cheap fuel" or would you go into business with the intention of making money?? The goal is to make money. Perhaps some of those profits will go back into future technology and refinery expansion to possibly provide cheaper fuel in the future?? Part of the problem now is the lack of refineries and most are old. Without making huge profits it would likely be even worse in the future.....business needs profits to expand and modernize.
I work for a large company, and while $27 billion sounds like alot, it is closer to the equivalent of $2700 to the average American....not huge.

 

[swampwater]

True, but that is what I would expect from the producer of a product that I use everyday in large quantities and don't live without. Energy is big money, lots to be made, and lots to be lost also.

Agreed but the bottom line is the price in a free market is totally controlled by supply and demand so either there is much more demand than supply or it is not really a free market. This is especially apparant when the whackos and our government refuses to allow us to retrieve the reserves we know are huge and under our jurisdiction. Swampy

 

[Sturgis Sledder]

You must also look at speculators, these people are doing nothing but driving the price up on a commodity they never intend on buying. In the end though the oil companies are STILL making record PROFITS after paying execs HUGE bonuses and salaries, bribing government officials errrr paying lobbiests, and claiming that it is supply and demand (which is BS because they control one whole side of the equation, the supply).

 

[Ollie]

Agreed but the bottom line is the price in a free market is totally controlled by supply and demand so either there is much more demand than supply or it is not really a free market. This is especially apparant when the whackos and our government refuses to allow us to retrieve the reserves we know are huge and under our jurisdiction. Swampy

Actually, supply and demand has nothing to do with it anymore.
The supply of oil is sufficiant to meet the demands and then some.
Gas reserves are higher than they were a year ago, yet prices continue to go up.
Oil companies are making obsene profits.

The whole thing moved away from supply and demand and went to speculation. All it takes is an Arab farting and they panic and push up the price. It is about profit, not supply.

There will be an oil crash in the next couple years. The speculators have pushed the price up beyond reason. The "experts" say the price could be justified by supply and demand at just over 50 dollars a barrel, not 100.

The speculators don't want to loose money so they continue to find new and exciting reasons to push up the price. With any bubble, it will burst.

 

[weetee]

Ollie, I usually agree with you, but I think you missed something here. The speculators buy oil based on what they think the supply headroom will be in the future. If world production capabilaty headroom expands, the price drops because it is less likely there will be a shortage. If headroom shrinks, the price goes up. (Been doing that forever). If the headroom is large, an Arab fart will not drive up the price because production can easily conpensate. You are right that If the speculators guess wrong, they can loose alot, but that proves my point. I dont think they want to speculate about future headroom wrong.
As far as the "obsene" profits, I"m glad to see an AMERICAN company doing so well.

 

[Dogmeat]

Actually, supply and demand has nothing to do with it anymore.
The supply of oil is sufficiant to meet the demands and then some.
Gas reserves are higher than they were a year ago, yet prices continue to go up.
Oil companies are making obsene profits.

The whole thing moved away from supply and demand and went to speculation. All it takes is an Arab farting and they panic and push up the price. It is about profit, not supply.

There will be an oil crash in the next couple years. The speculators have pushed the price up beyond reason. The "experts" say the price could be justified by supply and demand at just over 50 dollars a barrel, not 100.

The speculators don't want to loose money so they continue to find new and exciting reasons to push up the price. With any bubble, it will burst.

I guess my question is then ... who exactly are "the speculators" ....? Wall Street firms or the oil companies themselves?

 

[ruffryder]

I guess my question is then ... who exactly are "the speculators" ....? Wall Street firms or the oil companies themselves?

Oil companies are not supposed to corner the market in oil stocks and effect prices, but I remember hearing a story about people doing that in other markets, I think it was natural gas or something.

 

[Dogmeat]

When you say "corner the market" ... what do you mean exactly?

 

[ruffryder]

When you say "corner the market" ... what do you mean exactly?

I am not sure, I think I used it incorrectly. I remember a story about a group of people working in an energy company, that were secretly buying up all the energy stocks in that market. This allowed them to control the market.

How is that for vague? I probably shouldn't have posted it until I can find the story again. Anyone else know what I am talking about?

 

[Dogmeat]

I am not sure, I think I used it incorrectly. I remember a story about a group of people working in an energy company, that were secretly buying up all the energy stocks in that market. This allowed them to control the market.

How is that for vague? I probably shouldn't have posted it until I can find the story again. Anyone else know what I am talking about?

Yeah if you can clarify what you mean that'd be cool ...

I guess when you said "corner the market" I was thinking "Do you mean 'monopolize' something"? ...

In which case I don't think that's really possible in the oil and gas industry ... there are hundreds of independent oil and gas companies out there ...