Big Oil and the Truth
Thread Starter
Joined: Jan 2005
Posts: 36
Likes: 0
From: Greenville, Ohio
Big Oil and the Truth
Well from the responses from another thread, I am starting this thread to answer many of the issues brought up about evil big oil so it won’t be buried in the other thread. Below is a refresher course in world oil 101.
The jump in U.S. gasoline prices this year has so far drained consumers of an extra $20 billion, or about $146 for each passenger car in the country per the GAO. The national price for regular unleaded gasoline hit a record $3.22 a gallon this week, and is up $1.05 since the beginning of February, according to the Energy Department. The added expense is taking money away from consumers to spend on other goods and services, spending billions more on gasoline constrains consumers' budgets, leaving less money available for other purchases. Why don't people think about this with tax cuts? If you want to cut prices on gasoline, cut the taxes, the state, the city, the feds, etc. It adds up to 60 cents a gallon.
Many of you (and politicians) want to take the profits of big oil, But if you're big oil, why would you even consider investing billions of dollars in a country that is trying to effectively ban your product?
Someone noted that grocery stores profit margin is 2%, because people have to eat, and questioned why doesn't big oil look at it that way. Grocery stores are distributors, not manufacturers. Your local gas station is the distributor and is making only about 2% profit. Big oil is the manufacturer, just like Pepsi or Frito-Lay, and they make much more than 2% just like big oil does. Do you want to take their profit too? Let’s just take everyone’s profits? Remember we are governed by the free enterprise system. Profits are good! Live it, love it, or leave it.
I know that the gas price is one of these things that when it comes up, it goes up, people think that there's some suspicious or conspiratorial reason behind it, they just cannot accept the fact that the free market works in gasoline. So let me ask some questions. How many oil companies are there that sell gasoline in the US? I don't even know the answer, but it doesn't matter because there's more than one. If you don't think they are competing with each other, then you don't know the world. ExxonMobil, BP, Shell, and whoever the others are, they compete with one another. I realize that some of you might think they all get together and set the price, but even a US Senate study after hurricane Katrina proved there is no collusion.
How many companies are there selling gasoline in this country that are not American? Citgo, BP. Do you think that ExxonMobil and BP and the rest are getting together to set prices in the US? Remember, these people are the world market. Now, where does this oil come from? Gasoline is oil first and there are a bunch of different places it comes from all over the world. Actually, the number one country we get oil from is Canada. Not Saudi Arabia, Venezuela or Russia. The oil companies do not own this oil as it is, they have to purchase it.
So tell me how it is that oil, which starts the whole price timeline, coming from so many different places in the world, ends up as refined gasoline with no free market determining the price in this country. I want to know how this is possible. I want to know how it is that BP, ExxonMobil, Citgo, etc. are getting together with the Russians and with the Saudis and coordinating this. Then the guys playing the futures market in oil on the commodities market, I want you to tell me how they are involved in this so that the price is set by one person from the time it comes out of the ground 'til it gets to your car as gasoline. All these companies compete with one another at the retail level, they are competing with each other to find oil all over the world. We have to buy oil from all these different countries, and we have to refine it here. All of these aspects have market circumstances that rein in the desire for people to charge more than what they can get for it. Then you've got the stockholders of these publicly traded oil companies who are demanding profits as big as they can be. They're publicly traded companies and if the managers of these companies don't get as big a profit as they could or if they get too little a profit, there's going to be hell to pay from the shareholders.
Have you heard of a country called China? More and more people have access to automobiles that use gasoline, and they are putting a lot of pressure on the worldwide supply of gasoline. The US politicians are standing in the way of this country finding any more oil on our property; be it Alaska; be it off one of the coasts, they won't let it happen, while at the same time they're talking about energy independence.
Big oil earns only 30% of its income from operations in the United States. I want to know how it is that big oil and all these companies competing with one another somehow control the product around the world from the moment it comes out of the ground. I want to know how they own Saudi Arabia, Russia, Iran, and Venezuela. There's oil coming out of the ground everywhere but here. With all the pressure on the supply from the rising Chinese economy and the Indian economy, can you tell me how big oil controls every drop from the time it comes out of the ground until tends up as gasoline in your tank. But you can't tell me because it's not possible.
Do you like flipping on the light switch or having air conditioning at home? Where do you think that comes from? They won't let us do nuke power, so it's coal and it's oil. I haven't even scratched the surface of the oil industry and the costs in finding it, drilling it, bringing it up, transporting it as crude across the oceans and pipelines and so forth.
I literally am amazed that somehow the truth and the facts of the oil business, economics of the oil business, escape people when the economics of most other things are never questioned. I guess that comes from a vocal minority of activists and the Media routinely telling people they're being gouged. Yet nobody ever complains when they're talking about raising those taxes. This market is so complex, it's like the climate, although it's not nearly as complex as the climate, it is profoundly complex, and to try to control it and corner it is impossible.
Saudi Arabia at 8.3 million barrels a day is the largest producer in the world. ExxonMobil at 2.54 million barrels a day is the fifth largest. ExxonMobil's market share of the world oil market is 3%. There is no way big oil is engaging in price fixing and controlling every bit of the oil from the ground to your tank as gasoline with only 3% of the world oil market.
If you are really all that excited by the gas prices, maybe it’s time for you to trade in your Crossfire for a Toyota Prius, and you can join those smug others who like to smell their own farts (see South Park). I’m filling my Crossfire up and driving down the road just for the fun of it!
The jump in U.S. gasoline prices this year has so far drained consumers of an extra $20 billion, or about $146 for each passenger car in the country per the GAO. The national price for regular unleaded gasoline hit a record $3.22 a gallon this week, and is up $1.05 since the beginning of February, according to the Energy Department. The added expense is taking money away from consumers to spend on other goods and services, spending billions more on gasoline constrains consumers' budgets, leaving less money available for other purchases. Why don't people think about this with tax cuts? If you want to cut prices on gasoline, cut the taxes, the state, the city, the feds, etc. It adds up to 60 cents a gallon.
Many of you (and politicians) want to take the profits of big oil, But if you're big oil, why would you even consider investing billions of dollars in a country that is trying to effectively ban your product?
Someone noted that grocery stores profit margin is 2%, because people have to eat, and questioned why doesn't big oil look at it that way. Grocery stores are distributors, not manufacturers. Your local gas station is the distributor and is making only about 2% profit. Big oil is the manufacturer, just like Pepsi or Frito-Lay, and they make much more than 2% just like big oil does. Do you want to take their profit too? Let’s just take everyone’s profits? Remember we are governed by the free enterprise system. Profits are good! Live it, love it, or leave it.
I know that the gas price is one of these things that when it comes up, it goes up, people think that there's some suspicious or conspiratorial reason behind it, they just cannot accept the fact that the free market works in gasoline. So let me ask some questions. How many oil companies are there that sell gasoline in the US? I don't even know the answer, but it doesn't matter because there's more than one. If you don't think they are competing with each other, then you don't know the world. ExxonMobil, BP, Shell, and whoever the others are, they compete with one another. I realize that some of you might think they all get together and set the price, but even a US Senate study after hurricane Katrina proved there is no collusion.
How many companies are there selling gasoline in this country that are not American? Citgo, BP. Do you think that ExxonMobil and BP and the rest are getting together to set prices in the US? Remember, these people are the world market. Now, where does this oil come from? Gasoline is oil first and there are a bunch of different places it comes from all over the world. Actually, the number one country we get oil from is Canada. Not Saudi Arabia, Venezuela or Russia. The oil companies do not own this oil as it is, they have to purchase it.
So tell me how it is that oil, which starts the whole price timeline, coming from so many different places in the world, ends up as refined gasoline with no free market determining the price in this country. I want to know how this is possible. I want to know how it is that BP, ExxonMobil, Citgo, etc. are getting together with the Russians and with the Saudis and coordinating this. Then the guys playing the futures market in oil on the commodities market, I want you to tell me how they are involved in this so that the price is set by one person from the time it comes out of the ground 'til it gets to your car as gasoline. All these companies compete with one another at the retail level, they are competing with each other to find oil all over the world. We have to buy oil from all these different countries, and we have to refine it here. All of these aspects have market circumstances that rein in the desire for people to charge more than what they can get for it. Then you've got the stockholders of these publicly traded oil companies who are demanding profits as big as they can be. They're publicly traded companies and if the managers of these companies don't get as big a profit as they could or if they get too little a profit, there's going to be hell to pay from the shareholders.
Have you heard of a country called China? More and more people have access to automobiles that use gasoline, and they are putting a lot of pressure on the worldwide supply of gasoline. The US politicians are standing in the way of this country finding any more oil on our property; be it Alaska; be it off one of the coasts, they won't let it happen, while at the same time they're talking about energy independence.
Big oil earns only 30% of its income from operations in the United States. I want to know how it is that big oil and all these companies competing with one another somehow control the product around the world from the moment it comes out of the ground. I want to know how they own Saudi Arabia, Russia, Iran, and Venezuela. There's oil coming out of the ground everywhere but here. With all the pressure on the supply from the rising Chinese economy and the Indian economy, can you tell me how big oil controls every drop from the time it comes out of the ground until tends up as gasoline in your tank. But you can't tell me because it's not possible.
Do you like flipping on the light switch or having air conditioning at home? Where do you think that comes from? They won't let us do nuke power, so it's coal and it's oil. I haven't even scratched the surface of the oil industry and the costs in finding it, drilling it, bringing it up, transporting it as crude across the oceans and pipelines and so forth.
I literally am amazed that somehow the truth and the facts of the oil business, economics of the oil business, escape people when the economics of most other things are never questioned. I guess that comes from a vocal minority of activists and the Media routinely telling people they're being gouged. Yet nobody ever complains when they're talking about raising those taxes. This market is so complex, it's like the climate, although it's not nearly as complex as the climate, it is profoundly complex, and to try to control it and corner it is impossible.
Saudi Arabia at 8.3 million barrels a day is the largest producer in the world. ExxonMobil at 2.54 million barrels a day is the fifth largest. ExxonMobil's market share of the world oil market is 3%. There is no way big oil is engaging in price fixing and controlling every bit of the oil from the ground to your tank as gasoline with only 3% of the world oil market.
If you are really all that excited by the gas prices, maybe it’s time for you to trade in your Crossfire for a Toyota Prius, and you can join those smug others who like to smell their own farts (see South Park). I’m filling my Crossfire up and driving down the road just for the fun of it!
Forum Regular
Joined: Feb 2007
Posts: 412
Likes: 0
Re: Big Oil and the Truth
"Oil industry awash in record levels of cash
But a smaller portion of profits is going to find new oil discoveries"
http://www.msnbc.msn.com/id/8646744/
Please stop.
But a smaller portion of profits is going to find new oil discoveries"
http://www.msnbc.msn.com/id/8646744/
Please stop.
Re: Big Oil and the Truth
Hi Sterling13 – WOW! Are you misinformed?
I have spent a great portion of my life studying economics and business so here is a basic overview to your question.
In economics there is a term called “fungible commodity” that basically states that one commodity will provide the same (interchangeable) function as any other commodity.
Thus an automobile is really a fungible commodity - a Chrysler Crossfire will get me from point A to point B (obeying all laws) as say my Kawasaki 650C motorcycle (or even other cars). Even though the designs of a Crossfire and a motorcycle are very different.
Milk is fungible with baby formula (for children). Interchangeable is the key concept.
With this said, what substitute can you use to power your car? You can’t decide tomorrow to fill up your tank with Hydrogen, NAT Gas or propane. You are stuck with GASOLINE.
AND Gasoline is an “inelastic commodity”. I have posted a very good link to this concept to save me the time of typing – it basically says that if there are no substitutes for what you are purchasing, and you have great demand for that product – the producer of that product has you by the *****. They can raise the price and you will still purchase the same amount of product. Switching cost also come into play as it will cost you lots of money to sell your Crossfire and buy a Chevy sprint. But even then you will still need to buy GASOLINE.
WHO KILLED THE ELECTRIC CAR? – go rent the video.
http://en.wikipedia.org/wiki/Price_elasticity_of_demand
I could go even deeper but I think you get the point. There are no easy substitutes for petroleum products and we need the same amount of petroleum products no matter what the price is. It still takes X gallons of gas to fill my crossfire and if I need to drive my crossfire to work, I need X gallons of gasoline to do this every week. VERY INELASTIC. IF prices triple – I still need X Amount of gasoline and I will still buy X amount no matter the price. Think of poor UPS trucks. Man, are they getting screwed. Unless they purchase forward contracts to offset their ... Wait that’s another dissertation.
A good example to use is one local to me – California Rolling Blackouts. You remember this? Heck we recalled Governor Davis over this and put Arnold (Da Govenator) in his place. What substitutes did we have for electricity?? Thus if electric providers knew California needed lots of their product, and had nowhere else to go get it, plus add in de-regulation, all it took was to shut a few power plants down for maintenance here and there and BANG – spot prices jumped, a few blackouts to scare the state to use tax $$ into purchasing kilowatts at 100X the price paid 6 months prior (because regulation kept electric companies from having large cash reserves). ADD Employers threatening to leave the state if this was going to continue – well you get the picture. No rolling blackouts since then, and no new power plants to come on line since then – except they did get huge tax breaks and state/federal funding to start construction of more plants. WOW did that work out well for the power companies. (Manipulation)
Didn’t Exxon and other oil company’s just get a sweetheart tax incentive to drill/explore/lease more oil fields from congress? And after $$Billions in profits?? Remember US OIL RESERVES BELONG TO YOU AND ME – we just lease it out to EXXON.
I could go on and on but this is a good start. The point is – reduce domestic supply when demand is high (damn SUV’s and Trucks) and import 30% of the product at exuberantly high prices, and you just increased the price of the 70% of domestic supply to the same level. In other words – I was getting only $20 a barrel for domestic oil, but shut down 30% of my wells and import that amount at $60 a barrel and BANG - now I can charge $60 a barrel for 70% of the product that I was only getting $20 for last month. And what did it cost me? NOTHING!
To answer some of your other statements – Big oil only earns more that 30% of is income from the USA – A LOT MORE – look at the income statements from EXXON and other oil companies. Look at their Cost of Revenue (how much they spent) VS profit for 2005 to 2006. it only cost Exxon $253 million more to make $6.702 billion in gross profit. NICE – And they lend that money to the US Govt for you and me to pay back to them someday.
http://finance.yahoo.com/q/is?s=XOM&annual
The USA is the second largest producers of oil and the largest consumer of oil.
http://www.scaruffi.com/politics/oil.html
This tells you the whole answer to the record $$Billions$$ in profit every 3 months. That’s right – EVERY THREE MONTHS. Look at oil production in the USA – there is a large (and very old) oil field 20 miles from my house and all the pumps that go up and down are motionless yet there is still plenty of oil in the ground. Go figure that one. OPPPS - we need to shut down the Alaska Pipeline due to rust. Tension/war in the Middle East.
I wish I could say I am a purest but I saw it coming and purchased oil stocks in my 401K so I'm doing OK.
Gasoline tax:
Huge cash cow for federal, state and local governments. IF they give this up, then they will need to borrow more money to finance their budgets.
Who will they borrow this money from? The oil companies? OPEC? China?
And remember that GAS tax is by the gallon, not by the price. Filling your 20 gallon tank up with gas at $3.50 does not bring in anymore tax revenue to the government than 20 gallons at $2.00. And if gas taxes were removed, the price of gas would jump up that same amount the next day – why – because you got no where else to go and there is no gasoline price control in the USA. If you paid $3.25 a gallon for Gasoline and the Gas tax (say .60c a gallon) is eliminated – why should Exxon sell you gas a $2.65 tomorrow if you were willing to pay $3.25 yesterday? BANG – you would never see a price reduction, and Exxon would lend the instant profits to your now broke government. JUST PAY UP SUCKA!!
Ask me how to fix the problems and I will be glad to type for another hour – if you can stand to read it...just tell me what you want – lower gas prices – less dependencies on OPEC, Global warming – they all require a different mix of solutions and most are really, really painful... and the OIL COMPANIES KNOW THIS. OH yea - DID YOU KNOW THAT EVERY BARREL OF OIL SOLD ON THE WORLD MARKET IS PRICED IN US$$. That's right the US greenback - China buys oil from Canada - they do so in USD. Japan buys from Iran - USD.
No we need to figure in currency exchange rates and market currencies... no no no enough for now.
BASICALLY WHAT I AM SAYING IS THAT YOU GOT ALL WRONG DUDE!!!
I have spent a great portion of my life studying economics and business so here is a basic overview to your question.
In economics there is a term called “fungible commodity” that basically states that one commodity will provide the same (interchangeable) function as any other commodity.
Thus an automobile is really a fungible commodity - a Chrysler Crossfire will get me from point A to point B (obeying all laws) as say my Kawasaki 650C motorcycle (or even other cars). Even though the designs of a Crossfire and a motorcycle are very different.
Milk is fungible with baby formula (for children). Interchangeable is the key concept.
With this said, what substitute can you use to power your car? You can’t decide tomorrow to fill up your tank with Hydrogen, NAT Gas or propane. You are stuck with GASOLINE.
AND Gasoline is an “inelastic commodity”. I have posted a very good link to this concept to save me the time of typing – it basically says that if there are no substitutes for what you are purchasing, and you have great demand for that product – the producer of that product has you by the *****. They can raise the price and you will still purchase the same amount of product. Switching cost also come into play as it will cost you lots of money to sell your Crossfire and buy a Chevy sprint. But even then you will still need to buy GASOLINE.
WHO KILLED THE ELECTRIC CAR? – go rent the video.
http://en.wikipedia.org/wiki/Price_elasticity_of_demand
I could go even deeper but I think you get the point. There are no easy substitutes for petroleum products and we need the same amount of petroleum products no matter what the price is. It still takes X gallons of gas to fill my crossfire and if I need to drive my crossfire to work, I need X gallons of gasoline to do this every week. VERY INELASTIC. IF prices triple – I still need X Amount of gasoline and I will still buy X amount no matter the price. Think of poor UPS trucks. Man, are they getting screwed. Unless they purchase forward contracts to offset their ... Wait that’s another dissertation.
A good example to use is one local to me – California Rolling Blackouts. You remember this? Heck we recalled Governor Davis over this and put Arnold (Da Govenator) in his place. What substitutes did we have for electricity?? Thus if electric providers knew California needed lots of their product, and had nowhere else to go get it, plus add in de-regulation, all it took was to shut a few power plants down for maintenance here and there and BANG – spot prices jumped, a few blackouts to scare the state to use tax $$ into purchasing kilowatts at 100X the price paid 6 months prior (because regulation kept electric companies from having large cash reserves). ADD Employers threatening to leave the state if this was going to continue – well you get the picture. No rolling blackouts since then, and no new power plants to come on line since then – except they did get huge tax breaks and state/federal funding to start construction of more plants. WOW did that work out well for the power companies. (Manipulation)
Didn’t Exxon and other oil company’s just get a sweetheart tax incentive to drill/explore/lease more oil fields from congress? And after $$Billions in profits?? Remember US OIL RESERVES BELONG TO YOU AND ME – we just lease it out to EXXON.
I could go on and on but this is a good start. The point is – reduce domestic supply when demand is high (damn SUV’s and Trucks) and import 30% of the product at exuberantly high prices, and you just increased the price of the 70% of domestic supply to the same level. In other words – I was getting only $20 a barrel for domestic oil, but shut down 30% of my wells and import that amount at $60 a barrel and BANG - now I can charge $60 a barrel for 70% of the product that I was only getting $20 for last month. And what did it cost me? NOTHING!
To answer some of your other statements – Big oil only earns more that 30% of is income from the USA – A LOT MORE – look at the income statements from EXXON and other oil companies. Look at their Cost of Revenue (how much they spent) VS profit for 2005 to 2006. it only cost Exxon $253 million more to make $6.702 billion in gross profit. NICE – And they lend that money to the US Govt for you and me to pay back to them someday.
http://finance.yahoo.com/q/is?s=XOM&annual
The USA is the second largest producers of oil and the largest consumer of oil.
http://www.scaruffi.com/politics/oil.html
This tells you the whole answer to the record $$Billions$$ in profit every 3 months. That’s right – EVERY THREE MONTHS. Look at oil production in the USA – there is a large (and very old) oil field 20 miles from my house and all the pumps that go up and down are motionless yet there is still plenty of oil in the ground. Go figure that one. OPPPS - we need to shut down the Alaska Pipeline due to rust. Tension/war in the Middle East.
I wish I could say I am a purest but I saw it coming and purchased oil stocks in my 401K so I'm doing OK.
Gasoline tax:
Huge cash cow for federal, state and local governments. IF they give this up, then they will need to borrow more money to finance their budgets.
Who will they borrow this money from? The oil companies? OPEC? China?
And remember that GAS tax is by the gallon, not by the price. Filling your 20 gallon tank up with gas at $3.50 does not bring in anymore tax revenue to the government than 20 gallons at $2.00. And if gas taxes were removed, the price of gas would jump up that same amount the next day – why – because you got no where else to go and there is no gasoline price control in the USA. If you paid $3.25 a gallon for Gasoline and the Gas tax (say .60c a gallon) is eliminated – why should Exxon sell you gas a $2.65 tomorrow if you were willing to pay $3.25 yesterday? BANG – you would never see a price reduction, and Exxon would lend the instant profits to your now broke government. JUST PAY UP SUCKA!!
Ask me how to fix the problems and I will be glad to type for another hour – if you can stand to read it...just tell me what you want – lower gas prices – less dependencies on OPEC, Global warming – they all require a different mix of solutions and most are really, really painful... and the OIL COMPANIES KNOW THIS. OH yea - DID YOU KNOW THAT EVERY BARREL OF OIL SOLD ON THE WORLD MARKET IS PRICED IN US$$. That's right the US greenback - China buys oil from Canada - they do so in USD. Japan buys from Iran - USD.
No we need to figure in currency exchange rates and market currencies... no no no enough for now.
BASICALLY WHAT I AM SAYING IS THAT YOU GOT ALL WRONG DUDE!!!
Senior Member
Joined: Feb 2004
Posts: 862
Likes: 5
From: Maryland
Re: Big Oil and the Truth
sterling013,
great post.
when you consider that most of the big oil companies are making 8-12% profit the arguments against oil prices and windfall profits lose merit when you consider that the big banks have profit margins in excess of 30%!!! where's the outrage against the banks?
great post.
when you consider that most of the big oil companies are making 8-12% profit the arguments against oil prices and windfall profits lose merit when you consider that the big banks have profit margins in excess of 30%!!! where's the outrage against the banks?
Senior Member
Joined: Mar 2006
Posts: 1,586
Likes: 3
From: Austin, Texas
Re: Big Oil and the Truth
Originally Posted by Rob M
when you consider that most of the big oil companies are making 8-12% profit the arguments against oil prices and windfall profits lose merit when you consider that the big banks have profit margins in excess of 30%!!! where's the outrage against the banks?
How's that?
Senior Member
Joined: Feb 2004
Posts: 862
Likes: 5
From: Maryland
Re: Big Oil and the Truth
Originally Posted by Thirteendog
Moderator, will you please move this to the Political Section of this forum?
Senior Member
Joined: Dec 2006
Posts: 2,881
Likes: 3
Re: Big Oil and the Truth
Has anybody ever noticed that the manufactures and patent holders of alternative forms of energy storage and production, are held by the Big Oil monopolies.It's interesting that they produce solar cell unit panels, and new battery technologies, while at the same time they are holding back production on most of it. I know if they started manufacturing this stuff for the mass population, they will see tremendous record profits also, so why are we still using this old technology of gasoline's to power out world?
Personally I think our Government needs to intervene here for the sake of protecting the country as a whole. Wouldn't you agree that maybe our government be the soul producer of energy for it's country? Sounds logical to me. This stuff shouldn't be held by private firms, it just ain't right.
Personally I think our Government needs to intervene here for the sake of protecting the country as a whole. Wouldn't you agree that maybe our government be the soul producer of energy for it's country? Sounds logical to me. This stuff shouldn't be held by private firms, it just ain't right.
Last edited by Maxwell; May 24, 2007 at 06:11 PM.
Forum Regular
Joined: Feb 2007
Posts: 307
Likes: 0
From: Napavine, Wa
Re: Big Oil and the Truth
Didn't some one on here say when Bush took office gas was a $1.49? Yeah, I'm dumb, there really can't be a coinky - dinky there now could there? This political back and forth makes my gut turn. I said it once and I will say it again...BUSH AND HIS BOYS ARE GETTING PAID!!!
Thread Starter
Joined: Jan 2005
Posts: 36
Likes: 0
From: Greenville, Ohio
Re: Big Oil and the Truth
Moderator: Why was this thread censored by relegating it to the “general” category? Other threads on the same subject remain in the “crossfire coupe” category. Is it because they spew the media sacrosanct opinions? Why should I be censored for trying to bring a little reality to the conspiracy brain washed? If people do not like the thread, they do not need to read it.
Administrator
Joined: Nov 2003
Posts: 7,525
Likes: 18
From: Columbus, Ohio
-C-I-C-C-I Associate Member
Re: Big Oil and the Truth
sterling013 ~
this thread seems better suited in the 'general' section for on going discussions and opinions relating to one thoughts... input... etc...
i personally don't mind where it is place w/in the forum but felt it more appropriate in this category...
regardless... i appreciate your insight on this subject.
cheers~
this thread seems better suited in the 'general' section for on going discussions and opinions relating to one thoughts... input... etc...
i personally don't mind where it is place w/in the forum but felt it more appropriate in this category...
regardless... i appreciate your insight on this subject.
cheers~
Forum Regular
Joined: Apr 2007
Posts: 441
Likes: 0
From: Granite City, IL
Re: Big Oil and the Truth
Originally Posted by seayyard
Didn't some one on here say when Bush took office gas was a $1.49? Yeah, I'm dumb, there really can't be a coinky - dinky there now could there? This political back and forth makes my gut turn. I said it once and I will say it again...BUSH AND HIS BOYS ARE GETTING PAID!!!
Senior Member
Joined: Feb 2004
Posts: 862
Likes: 5
From: Maryland
Re: Big Oil and the Truth
sterling013,
At least BOTH posts ended up here, LOL.
I've reached similar conclusions on oil and oil prices. I tried to keep an open mind and have done a lot of research. Two of the biggest factors in recent oil price increases are inflation and increased worldwide demand. During the current administration prices for the things we need most - energy, housing, food, education, healthcare, etc., have realistically gone up by 50% or more on average. It's only the things from China and other low-cost labor countries that keep the manipulated CPI low. Oil consumption has increased by 10% during the past 7 years. China is quietly securing oil rights around the globe.
If there were a viable alternative to petroleum fuel right now we would be using it. Battery operated cars have been around for more than 100 years, and the technology still isn't to the point where most consumers would use it. Ethanol is a complete joke, except when mixed with a Coke. But good old petroleum is still relatively cheap and reasonably plentiful. People won't be able to complain about big oil when supplies dwindle some day. Maybe they'll blame Big Solar or Big Wind then. Of course, Big Solar might just be BP so the same company would still be under attack. Even if Big Oil agreed to eliminate their profits entirely, the price of gas would go down maybe $0.15/gal which still wouldn't make people happy.
At least BOTH posts ended up here, LOL.
I've reached similar conclusions on oil and oil prices. I tried to keep an open mind and have done a lot of research. Two of the biggest factors in recent oil price increases are inflation and increased worldwide demand. During the current administration prices for the things we need most - energy, housing, food, education, healthcare, etc., have realistically gone up by 50% or more on average. It's only the things from China and other low-cost labor countries that keep the manipulated CPI low. Oil consumption has increased by 10% during the past 7 years. China is quietly securing oil rights around the globe.
If there were a viable alternative to petroleum fuel right now we would be using it. Battery operated cars have been around for more than 100 years, and the technology still isn't to the point where most consumers would use it. Ethanol is a complete joke, except when mixed with a Coke. But good old petroleum is still relatively cheap and reasonably plentiful. People won't be able to complain about big oil when supplies dwindle some day. Maybe they'll blame Big Solar or Big Wind then. Of course, Big Solar might just be BP so the same company would still be under attack. Even if Big Oil agreed to eliminate their profits entirely, the price of gas would go down maybe $0.15/gal which still wouldn't make people happy.
Forum Regular
Joined: Feb 2007
Posts: 412
Likes: 0
Re: Big Oil and the Truth
Originally Posted by snowtop57
Then why are the gas prices still artificially high with a democratic controlled congress?
Senior Member
Joined: Feb 2004
Posts: 862
Likes: 5
From: Maryland
Re: Big Oil and the Truth
Originally Posted by Mediacritic
Just passed legislation making gouging a federal crime. We'll have to wait and see if it has "teeth".
A better solution would be to get the corn out of the fuel. We'd save quite a bit per gallon, would see no net harm to the environment (when all aspects of ethanol production and energy output are considered), and meat, eggs, poultry, and even Coca Cola would be cheaper.
Forum Regular
Joined: Feb 2007
Posts: 412
Likes: 0
Re: Big Oil and the Truth
The House, eager to do something about record high gasoline prices in advance of the Memorial Day weekend, voted narrowly Wednesday to approve stiff penalties for those found guilty of gasoline price gouging.
(Bush will likely veto to help protect oil companies gross profiteering and price gouging.) 5/24
- Buzzflash
http://www.msnbc.msn.com/id/18825910/
(Bush will likely veto to help protect oil companies gross profiteering and price gouging.) 5/24
- Buzzflash
http://www.msnbc.msn.com/id/18825910/
Forum Regular
Joined: Feb 2007
Posts: 307
Likes: 0
From: Napavine, Wa
Re: Big Oil and the Truth
Originally Posted by snowtop57
Then why are the gas prices still artificially high with a democratic controlled congress?
Forum Regular
Joined: Feb 2007
Posts: 307
Likes: 0
From: Napavine, Wa
Re: Big Oil and the Truth
Originally Posted by Rob M
sterling013,
At least BOTH posts ended up here, LOL.
I've reached similar conclusions on oil and oil prices. I tried to keep an open mind and have done a lot of research. Two of the biggest factors in recent oil price increases are inflation and increased worldwide demand. During the current administration prices for the things we need most - energy, housing, food, education, healthcare, etc., have realistically gone up by 50% or more on average. It's only the things from China and other low-cost labor countries that keep the manipulated CPI low. Oil consumption has increased by 10% during the past 7 years. China is quietly securing oil rights around the globe.
If there were a viable alternative to petroleum fuel right now we would be using it. Battery operated cars have been around for more than 100 years, and the technology still isn't to the point where most consumers would use it. Ethanol is a complete joke, except when mixed with a Coke. But good old petroleum is still relatively cheap and reasonably plentiful. People won't be able to complain about big oil when supplies dwindle some day. Maybe they'll blame Big Solar or Big Wind then. Of course, Big Solar might just be BP so the same company would still be under attack. Even if Big Oil agreed to eliminate their profits entirely, the price of gas would go down maybe $0.15/gal which still wouldn't make people happy.
At least BOTH posts ended up here, LOL.
I've reached similar conclusions on oil and oil prices. I tried to keep an open mind and have done a lot of research. Two of the biggest factors in recent oil price increases are inflation and increased worldwide demand. During the current administration prices for the things we need most - energy, housing, food, education, healthcare, etc., have realistically gone up by 50% or more on average. It's only the things from China and other low-cost labor countries that keep the manipulated CPI low. Oil consumption has increased by 10% during the past 7 years. China is quietly securing oil rights around the globe.
If there were a viable alternative to petroleum fuel right now we would be using it. Battery operated cars have been around for more than 100 years, and the technology still isn't to the point where most consumers would use it. Ethanol is a complete joke, except when mixed with a Coke. But good old petroleum is still relatively cheap and reasonably plentiful. People won't be able to complain about big oil when supplies dwindle some day. Maybe they'll blame Big Solar or Big Wind then. Of course, Big Solar might just be BP so the same company would still be under attack. Even if Big Oil agreed to eliminate their profits entirely, the price of gas would go down maybe $0.15/gal which still wouldn't make people happy.
Joined: May 2007
Posts: 9
Likes: 0
From: Houston
Re: Big Oil and the Truth
I'll try not to repeat Economics 101 here. I work in big oil. There are no Darth Vader's running my company, a super major. We operate in a world market economy. The risks of breaking FTC regulations are extremely high which may include loss of job, big personal fines, and prison terms. Allegation of fraud are heavily investigated by the justice department.
I walk through one of our trading benches each day. Our traders do not set the prices of the commodities. Their phone conversations are taped, and their emails and instant messages are scanned for key words and phrases and reviewed for security and trading violations. They buy and sell products on the open market just like any of you could do if you had the means or infrastructure to move product to wholesalers or consumers. You actually can buy futures of crude oil, natural gas, propane, gold, pork bellies, etc. through investment brokers. Why don't you do a search on futures, find a site, and look at the wholesale price of some commodity, like unleaded regular? Then you'll know how much difference there is between wholesale refined product and retail paid at the pump. Most of it is tax. The refiner makes about 8 cents a gallon, the retailer makes about 10 cents a gallon. Many branded stations are independently owned by individuals, not by the oil company on the signage. And owners must draw in customers to buy non-fuel items at their stations with high markups like bottled water. So, where's the gouging? Hmmm. What are the state and federal governments bringing in? I'm not complaining about the tax on fuel since a lot of it goes to road building and repair.
My coworkers and I do not get any company discounts on gasoline. We buy it and share the pain of unanticipated higher costs just like all consumers. I've worked at several of our plants over the years. The engines, heaters, and other units that run some of these processes use natural gas and lots of it. The plants have to buy the natural gas at market price to run the units, not at a company discount price. If big oil could control the pricing, it could always be advantaged in all situations. In 31 years in the business, I've seen record high prices (mid-1970's), extremely low prices (1986-1987; late 1990's), and high prices again (2007). On an inflation adjusted basis, gasoline is no more expensive than it was in 1981. What has hurt all of us is that we have budgeted our personal expenses for cheap gasoline. Then when it has gone up rapidly, we have to adjust quickly for it. If gasoline prices had simply risen gradually along with inflation (or the consumer price index) we would not have noticed.
I walk through one of our trading benches each day. Our traders do not set the prices of the commodities. Their phone conversations are taped, and their emails and instant messages are scanned for key words and phrases and reviewed for security and trading violations. They buy and sell products on the open market just like any of you could do if you had the means or infrastructure to move product to wholesalers or consumers. You actually can buy futures of crude oil, natural gas, propane, gold, pork bellies, etc. through investment brokers. Why don't you do a search on futures, find a site, and look at the wholesale price of some commodity, like unleaded regular? Then you'll know how much difference there is between wholesale refined product and retail paid at the pump. Most of it is tax. The refiner makes about 8 cents a gallon, the retailer makes about 10 cents a gallon. Many branded stations are independently owned by individuals, not by the oil company on the signage. And owners must draw in customers to buy non-fuel items at their stations with high markups like bottled water. So, where's the gouging? Hmmm. What are the state and federal governments bringing in? I'm not complaining about the tax on fuel since a lot of it goes to road building and repair.
My coworkers and I do not get any company discounts on gasoline. We buy it and share the pain of unanticipated higher costs just like all consumers. I've worked at several of our plants over the years. The engines, heaters, and other units that run some of these processes use natural gas and lots of it. The plants have to buy the natural gas at market price to run the units, not at a company discount price. If big oil could control the pricing, it could always be advantaged in all situations. In 31 years in the business, I've seen record high prices (mid-1970's), extremely low prices (1986-1987; late 1990's), and high prices again (2007). On an inflation adjusted basis, gasoline is no more expensive than it was in 1981. What has hurt all of us is that we have budgeted our personal expenses for cheap gasoline. Then when it has gone up rapidly, we have to adjust quickly for it. If gasoline prices had simply risen gradually along with inflation (or the consumer price index) we would not have noticed.