posted
In just one year . Remember the election in 2006?
Thought you might like to read the following:
A little over one year ago:
1) Consumer confidence stood at a 2 1/2 year high; 2) Regular gasoline sold for $2.19 a gallon; 3) The unemployment rate was 4.5%.
Since voting in a Democratic Congress in 2006 we have seen:
1) Consumer confidence plummet; 2) The cost of regular gasoline soar to over $3.50 a gallon; 3) Unemployment is up to 5% (a 10% increase); 4) American households have seen $2.3 trillion in equity value evaporate (stock and mutual fund losses); 5) Americans have seen their home equity drop by $1.2 trillion dollars; 6) 1% of American homes are in foreclosure.
America voted for change in 2006, and we got it!
Remember it's Congress that makes law not the President. He has to work with what's handed to him.
A liberal is a person who will give away everything they don't own.
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very, very sadly, that's the best explanation I've seen for the oil/gasoline travesty: apparently, Bush's pals went to work ratcheting up the pps as a smear tactic against Dem-Congress...
not to mention windfall profits
-------------------- Nashoba Holba Chepulechi Adventures in microcapitalism...
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Don't forget big it was a democrat that brought us through the last depression because he had guts.
Hoover left in disgrace and we did not see another repubilcan until eisenhower
Rooseavelt brought us through WWII, also all of his sons served in the military .
That same spirit will arise to any bad time again.
One thing for sure the current deserter and his draft dogging side kick are going to line there pockets with cash and run away to let the rest of us deal with the problems.
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[i]Estimated profit per gallon for Exxon is .10 cents. The feds take you for upwards of .18 cents per gallon. New York gas taxes equal an additional .68 cents per gallon. So who's gouging you now?[\i]
Big Governement could drop your price at the pump in some states by as much as a dollar if they really cared...which is why they haven't.
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[i]Estimated profit per gallon for Exxon is .10 cents. The feds take you for upwards of .18 cents per gallon. New York gas taxes equal an additional .68 cents per gallon. So who's gouging you now?[\i]
Big Governement could drop your price at the pump in some states by as much as a dollar if they really cared...which is why they haven't.
you kidding me?
lol, I live way up-front in Texas: Bush-baggers, JFK-killers, LBJ-wildflowers, Halliburton/IRAQ, VietNam/Brown 'n phuking Root... what's your mis-spelling point?
-------------------- Nashoba Holba Chepulechi Adventures in microcapitalism...
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[i]Estimated profit per gallon for Exxon is .10 cents. The feds take you for upwards of .18 cents per gallon. New York gas taxes equal an additional .68 cents per gallon. So who's gouging you now?[\i]
Big Governement could drop your price at the pump in some states by as much as a dollar if they really cared...which is why they haven't.
big govt could forget bulding your roads to drive on too...
and it could stop making sure your food is safe to eat...
why not just stop putting people in prison and turn all the inmates loose while we are at it? then we can just sit on our front porch and shoot looters all day
-------------------- Don't envy the happiness of those who live in a fool's paradise.
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Ok, I think my point has been lost...let me try again. Out of every gallon that we buy, Big Oil only makes about 10 cents of profit. That means that even if tomorrow they decided to become a non-profit charity oil company, you would still be paying over 3 dollars per gallon for your fuel.
The cost of buying and refining the oil has become more expensive because the Oil Cartel knows people will pay it. That cost has to be passed onto the consumer for the oil companies to remain in business. The 'Windfall Profits' that both sides of the political aisle are taking aim at, are simply the aggregate amount of millions of dimes that they are making. Their profit margin is an average of about 3% of the cost of the final product. 3%! They are simply selling ALOT of product. Ask your local retailer how much of a markup they add to your TV, or your shirt, or heaven forbid, your food. Having worked in retail, I'll tell you right now, it's more than 3%.
Glass, the intent of the Goverment portion of my post was to put the 10 cents in perspective. I am fully aware that the taxes generated by fuel consumption go to many causes that none of us want to be without. That being said, I feel it is disingenuous of the politicians to point at the Big Oil folks and call what they make (from a legal, honest business) gouging when they take more than six times that amount from the same product.
Finally, Tex. I don't intend to misspell, I was trying to myth-dispel.
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quote:Big Oil only makes about 10 cents of profit. That means that even if tomorrow they decided to become a non-profit charity oil company, you would still be paying over 3 dollars per gallon for your fuel.
love to see the math...
lol, you whack all the myths you want, show me da math on that oil processsssssssss
-------------------- Nashoba Holba Chepulechi Adventures in microcapitalism...
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Ok, guess I have to pass out the tin foil hats before the brain wave guns get us. (sigh)
The first hat goes to Tex: show me da math on that oil processsssssssss
Ok, Total cost of Crude (dictated by OPEC) + Cost of refining into three seperate blends of gasoline + Transportation costs + Lots of taxes by the Government = What you're paying at the pump - 10 Cents
If you want any more detail than that, try Googling it.
Next hat...IWISHIHAD!
Oil companies are not like any other business that i have seen. They are an elite group that control way to much of our economy and our lives.
That's like saying the Tourism industry in Hawaii or the Bahamas control way too much of their economies. That's what they do for a living. It's the tourists that freely choose to visit and spend the money. No undue pressure is made upon them. What are you going to say when we're running on ethanol? That the corn farmers are robber barons? That they shouldn't make a profit from the corn? We choose to use oil, like it or not. They simply provide it for us.
They have so many ways to hide so much money beyond what they are declaring after taxes. There is so much skimming off the top.
There is a reason that Envy is among the Seven Deadlies. Why is it that everytime someone (or business) gets and stays successful, the first charge levied at them by those who have less is that they couldn't possibly make that much money honestly? I mean, it can't possibly be that they are selling a product in high demand at a competetive price? Nah, it MUST be they are stealing from the poor man. Class envy is so unbecoming.
Finally, the best and brightest hat goes to Glass on this one.
Bush uses the excuse to invade Iraq and suddenly we are paying almost 4 times as much for oil TO THE SAUDI'S
First, most of the world's oil prices are set either directly or indirectly by OPEC. That includes: Algeria, Indonesia, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates and Venezuela. Saudi Arabia does not dictate the price unilateraly nor does it receive any more profit (proportionately speaking) than any of the others.
Second, did you actually look at the chart you posted? The price of oil (per barrel) rose many times over the course of the timeline. Each of the spikes prior to the 90's had little or nothing to do with the U.S. They were reactions to threats to the supply. Even the one's we were involved in are similarly linked. A threat to one source of oil places a greater strain on the remainder. Greater Demand, greater price. I refuse to believe that as a business owner you don't understand this concept. The price of oil is currently increasing do to nothing more sinister than there are a hell of a lot more cars\trucks\suv's out in this world that run on it. Also, the plastics currently used in nearly everything we use come from what? That's right. Oil. More Demand...same supply...higher cost. It's that simple. Econ 101 stuff.
Finally to all the 'Big Oil Sucks' folks out there. You don't like the price of gas? Buy a bicycle. Work closer to home. Or, even better, invent a car that runs on complaints...you'd never have to worry about running out of fuel.
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quote:Originally posted by SeekingFreedom: Bush uses the excuse to invade Iraq and suddenly we are paying almost 4 times as much for oil TO THE SAUDI'S
First, most of the world's oil prices are set either directly or indirectly by OPEC. That includes: Algeria, Indonesia, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates and Venezuela. Saudi Arabia does not dictate the price unilateraly nor does it receive any more profit (proportionately speaking) than any of the others.
Second, did you actually look at the chart you posted? The price of oil (per barrel) rose many times over the course of the timeline. Each of the spikes prior to the 90's had little or nothing to do with the U.S. They were reactions to threats to the supply. Even the one's we were involved in are similarly linked. A threat to one source of oil places a greater strain on the remainder. Greater Demand, greater price. I refuse to believe that as a business owner you don't understand this concept. The price of oil is currently increasing do to nothing more sinister than there are a hell of a lot more cars\trucks\suv's out in this world that run on it. Also, the plastics currently used in nearly everything we use come from what? That's right. Oil. More Demand...same supply...higher cost. It's that simple. Econ 101 stuff.
supply/demand? there is no shortage of oil, there has been a shortage of gasoline, and gasoline has been LEADING the price of oil in the last three-four years, not vice versa.
of course i looked a the chart, it proves my point, and so do you; first you support my argument by saying OPEC sets the price? then you say i'm wrong when i point out that every war has caused spike in the price of oil? what have you been drinking tonight?
gasoline has gone up due to REFINERY issues, and oil follows it... it's been happening regularly since the Iraq war started.
[IMG][/IMG]
-------------------- Don't envy the happiness of those who live in a fool's paradise.
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quote:Originally posted by SeekingFreedom: Ok, guess I have to pass out the tin foil hats before the brain wave guns get us. (sigh)
The first hat goes to Tex: show me da math on that oil processsssssssss
Ok, Total cost of Crude (dictated by OPEC) + Cost of refining into three seperate blends of gasoline + Transportation costs + Lots of taxes by the Government = What you're paying at the pump - 10 Cents
If you want any more detail than that, try Googling it.
Next hat...IWISHIHAD!
Oil companies are not like any other business that i have seen. They are an elite group that control way to much of our economy and our lives.
That's like saying the Tourism industry in Hawaii or the Bahamas control way too much of their economies. That's what they do for a living. It's the tourists that freely choose to visit and spend the money. No undue pressure is made upon them. What are you going to say when we're running on ethanol? That the corn farmers are robber barons? That they shouldn't make a profit from the corn? We choose to use oil, like it or not. They simply provide it for us.
They have so many ways to hide so much money beyond what they are declaring after taxes. There is so much skimming off the top.
There is a reason that Envy is among the Seven Deadlies. Why is it that everytime someone (or business) gets and stays successful, the first charge levied at them by those who have less is that they couldn't possibly make that much money honestly? I mean, it can't possibly be that they are selling a product in high demand at a competetive price? Nah, it MUST be they are stealing from the poor man. Class envy is so unbecoming.
Finally, the best and brightest hat goes to Glass on this one.
Bush uses the excuse to invade Iraq and suddenly we are paying almost 4 times as much for oil TO THE SAUDI'S
First, most of the world's oil prices are set either directly or indirectly by OPEC. That includes: Algeria, Indonesia, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates and Venezuela. Saudi Arabia does not dictate the price unilateraly nor does it receive any more profit (proportionately speaking) than any of the others.
Second, did you actually look at the chart you posted? The price of oil (per barrel) rose many times over the course of the timeline. Each of the spikes prior to the 90's had little or nothing to do with the U.S. They were reactions to threats to the supply. Even the one's we were involved in are similarly linked. A threat to one source of oil places a greater strain on the remainder. Greater Demand, greater price. I refuse to believe that as a business owner you don't understand this concept. The price of oil is currently increasing do to nothing more sinister than there are a hell of a lot more cars\trucks\suv's out in this world that run on it. Also, the plastics currently used in nearly everything we use come from what? That's right. Oil. More Demand...same supply...higher cost. It's that simple. Econ 101 stuff.
Finally to all the 'Big Oil Sucks' folks out there. You don't like the price of gas? Buy a bicycle. Work closer to home. Or, even better, invent a car that runs on complaints...you'd never have to worry about running out of fuel.
re-fold that tin foil and use it as a suppository...
oilies were making plenty of dough at lower prices. What happened? Did their fuel costs up?
-------------------- Nashoba Holba Chepulechi Adventures in microcapitalism...
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October 2007 Federal Reserve Bank of Dallas
What's Driving Gasoline Prices? by Stephen P. A. Brown and Raghav Virmani
Anyone who regularly fills a car's gas tank knows U.S. pump prices have been high and volatile in recent years, whether measured in current or inflation-adjusted dollars (Chart 1). Most motorists are well aware that crude oil prices have surged to one record after another; yet the ups and downs in gasoline prices sometimes seem confusing. This spring, gasoline was getting more expensive at a time when oil prices were falling. Just a few months later, oil had been bid back up, but gasoline prices didn't seem to respond. These apparent disconnects prompted our examination of the forces that determine gasoline prices. Our econometric models confirm the traditional result that crude oil prices dominate movements in gasoline prices, but they also show that seasonal and nonseasonal movements in consumption, refinery production, imports and inventories influence gasoline prices in the short term. Including these other factors with crude oil price provides a nearly complete picture of gasoline pricing in the U.S. market.This year, some nonseasonal factors have been out of their normal ranges, contributing to gasoline price volatility and creating market conditions where prices are rising for gasoline and falling for oil, or vice versa. These events are unlikely to recur, so any disconnects should prove short-lived. Our most complete model suggests gasoline prices will retain their seasonal variations but decline slightly in the next few years, a result generally consistent with recent readings in the futures markets. http://www.dallasfed.org/research/eclett/2007/el0710.html
the "thing" is? they have been recurring for several years, oil prices have followed gasoline up and price supports have been established at each new high...
the general consensus on the streeet is that oil should be 80$ max...
speculators (read oil buyers/oil refiners) are buying contracts and holding for the higher price instead of selling...
-------------------- Don't envy the happiness of those who live in a fool's paradise.
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Glass, neither of these two charts supports the arguement that gas prices dictate oil costs. That's like saying the cost of shirts dictates the cost of cotton. Or, the cost of candybars dictates the cost of sugar. Cart before the horse and all that crap. The entire concept is ridiculous. For that to be true, the profit margin for the oil companies would have to be consistantly shrinking as oil prices rose. Otherwise, the increase cost in oil would mean higher prices in gas due to the increase being passed on at the pumps.
Your first chart is apples and oranges. It uses two seperate currencies to contrast the two items. This neither allows for fluctuations in value of the two currencies nor the economic pressures within the seperate nations. Even if you do take it at face value, save for the '79 spike, they both share an almost identical path even sharing most of their spikes. This tells us nothing about which was cause, and which was effect. The second chart has the same flaw, they both correlate to rise and decent. But nothing says which is leading the other.
If the U.S. had a major source of oil (that we could use), ie more SUPPLY, the price of oil would fall as we would have less DEMAND on foreign oil. Domestic sources would mean less transportation costs and thus lower price to consumers.
Tex, your eloquence astounds me. But, to answer your quip anyway; haven't you been bombarded by the news about rising oil prices 'down there on the frontline?' YES!! The oil is effectively their fuel (raw material) and it's been going up for awhile now. They have to pass that cost increase on to the consumer or they go out of business. You can't sell a product for less than it take to make it. Once again, Econ 101.
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Katrina, refinery fires and explosions, switching the seasonal blends, and there was also big hitch when they started trying to transport ethanol...
Tuesday, 4 Mar 2008 Hedge Funds: They're Dictating Oil Prices, Not Fundamentals Posted By:Sharon Epperson
You'd expect oil prices to take a bit of a breather after yesterday's record-breaking run that took NYMEX crude oil futures to an all-time high of $103.95/barrel intraday, surpassing the inflation-adjusted record reached more than a quarter century ago.
Yet today the market has been holding fairly steady, with some light profit-taking here and there, still prices oil holding steady ABOVE $100/barrel. Blame this record on the hedge funds once again. IT'S THE FUNDS, NOT FUNDAMENTAL DICTATING THE PRICE AGAIN IN THE ENERGY MARKETS THESE DAYS. The dollar is a major factor. As Greg Anderson, a currency strategist points out in today's Wall Street Journal, the price of oil and the euro's exchange rate against the dollar have moved in the same direction about 96 percent of the time from the start of 2007 until now. And traders are betting on this trend continuing.
Tradition Energy's director of research Addison Armstrong says: "The weakness of the dollar has drawn funds to the commodity markets at full speed." The latest data from the CFTC's Commitment of Traders report shows hedge funds and other large speculators bought more than $3 billion worth of crude oil in the last week bringing their total exposure to $9.2 billion. Meanwhile, these funds have increased their net long position by more than 50 percent, the biggest rise since the beginning of January. How can oil prices continue to climb when tomorrow's weekly report on U.S. crude supplies is expected to show oil supplies increased for the eighth week in a row and gasoline supplies are at their highest level since 1994?
lol, not surprised: you know your way around a sentence and not too bad with paragraphs, either.
However? Logic, maybe not so much...
For instance, Glass is providing data (which I haven't checked, admittedly) re: market manipulation. Without verifying that data, I can however say it doesn't surprise me.
I built the reference system for ARCO Oil & Gas's Systems & Programming Dept. ... If you think the oilies are holding the line as best they can for the consumer, you're in line for some major disappointment.
-------------------- Nashoba Holba Chepulechi Adventures in microcapitalism...
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Big oil companies are making most of their money by producing crude oil. They invested in oil fields when prices were much lower, with the expectation that they could break even at, say, $25 per barrel. Since the market price is now more than $70 a barrel, the extra money is gravy. It's like a farmer who can raise corn for $1.50 a bushel. If the market price is $1.75, he makes a quarter per bushel. If the market price jumps to $2.25, his profits jump as well. (If the market crashes to $1 per bushel, the farmer loses money. That can happen to oil companies as well.) Oil companies, like the farmer, are the beneficiaries of high market prices, but they can no more control those prices than a farmer can dictate what he gets for a bushel of corn.
quote:Originally posted by glassman: Big oil companies are making most of their money by producing crude oil. They invested in oil fields when prices were much lower, with the expectation that they could break even at, say, $25 per barrel. Since the market price is now more than $70 a barrel, the extra money is gravy. It's like a farmer who can raise corn for $1.50 a bushel. If the market price is $1.75, he makes a quarter per bushel. If the market price jumps to $2.25, his profits jump as well. (If the market crashes to $1 per bushel, the farmer loses money. That can happen to oil companies as well.) Oil companies, like the farmer, are the beneficiaries of high market prices, but they can no more control those prices than a farmer can dictate what he gets for a bushel of corn.
BUT? farmers (and more importantly? seed growers/ dealers like Monsanto) DO control the price of corn
You don't mean Joe Retail/family farms, eh? Unless something drastic has happened since I covered that area, independent farmers bought almost everything retail and sold almost everything wholesale.
Now, if you mean Cargill et al, corporate operations, that's different. The grain companies, for instance, employ a private network of reporters and analysts. Of course, their reports seldom see the light of public dissemination.
-------------------- Nashoba Holba Chepulechi Adventures in microcapitalism...
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i mean the big ones. this year? there was a "convenient" shortage of soy seed...they expected everybody to want to plant more corn? maybe, or maybe they just want more corn.
Shortage of soybean seeds may hinder farmers this year March 12, 2008 - 8:29PM Sue Book Sun Journal
Soybean seeds are scarce for this year's planting, a particular concern for area farmers as the price of the commodity hits record highs.
"Suppliers are telling us there are no seeds," said Mike Carroll, extension agent for Craven County Cooperative Extension Service.
Mississippi Could See Soybean Seed Shortage in 2008 Northeast Mississippi Daily Journal (Tupelo, MS) (KRT) -- Mar. 12 -- TUPELO -- Soybean acreage in the state is expected to be the highest in a decade, hitting 2 million this year -- a 25 percent increase over last year.
PAID ADVERTISEMENT But growers who are getting ready to plant the crop next month are running into a potential problem -- not enough seed.
Last year, one bag of a particular type of soybean seed cost $14.95.
This year, Murphree said, the same bag goes for about $27.
posted
quote: "That's like saying the Tourism industry in Hawaii or the Bahamas control way too much of their economies. That's what they do for a living. It's the tourists that freely choose to visit and spend the money. No undue pressure is made upon them. What are you going to say when we're running on ethanol? That the corn farmers are robber barons? That they shouldn't make a profit from the corn? We choose to use oil, like it or not. They simply provide it for us." _________________________________________________
You are not even close with that comparison.
Like i said before they are and elite group that's why they are called a Cartel.
I have never heard the tourism group in Hawaii or Bahamas called a Cartel probably for good reason.
Actually i am not sure who is what when it comes to corn and ethanol. The Government-Farmers sometimes it's hard to seperate them, but i can tell you this there are some law suits coming to help separate one of the problems and it's coming from food companies.
But then we are still left with the major problem- oil monopolies.
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Glass, lol, I heard even tequilla price is affected cuz Mexican farmers are veering toward corn, even in areas that aren't corn-friendly (duh...cactus).
dunno, but that's something I ran across...
-------------------- Nashoba Holba Chepulechi Adventures in microcapitalism...
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quote:Originally posted by IWISHIHAD: quote: "That's like saying the Tourism industry in Hawaii or the Bahamas control way too much of their economies. That's what they do for a living. It's the tourists that freely choose to visit and spend the money. No undue pressure is made upon them. What are you going to say when we're running on ethanol? That the corn farmers are robber barons? That they shouldn't make a profit from the corn? We choose to use oil, like it or not. They simply provide it for us." _________________________________________________
You are not even close with that comparison.
Like i said before they are and elite group that's why they are called a Cartel.
I have never heard the tourism group in Hawaii or Bahamas called a Cartel probably for good reason.
Actually i am not sure who is what when it comes to corn and ethanol. The Government-Farmers sometimes it's hard to seperate them, but i can tell you this there are some law suits coming to help separate one of the problems and it's coming from food companies.
But then we are still left with the major problem- oil monopolies.
DOH!
Tourism is like an elective...
a lark for those with excess cash.
Most of the guys who build and repair America's "stuff" have NO CHOICE, and we are getting PHUCKED at the pump. Personally, I don't understand how anyone can in good conscience buy even a gallon for their lawn mower from EXXON...
-------------------- Nashoba Holba Chepulechi Adventures in microcapitalism...
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I always heard it was much cheaper to process. Was never sure how true.
It is now $1.00 more a gallon than regular gasoline.
A guy the other day was filling up next to me complaining because he bought a diesel truck figuring the diesel price would be cheaper.
He said he spends a lot of time in Mexico and pays $2.00 plus a gallon down there. I do not know that to be a fact just took it for what it was worth.
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quote:Originally posted by Bob Frey: In just one year . Remember the election in 2006?
Thought you might like to read the following:
A little over one year ago:
1) Consumer confidence stood at a 2 1/2 year high; 2) Regular gasoline sold for $2.19 a gallon; 3) The unemployment rate was 4.5%.
Since voting in a Democratic Congress in 2006 we have seen:
1) Consumer confidence plummet; 2) The cost of regular gasoline soar to over $3.50 a gallon; 3) Unemployment is up to 5% (a 10% increase); 4) American households have seen $2.3 trillion in equity value evaporate (stock and mutual fund losses); 5) Americans have seen their home equity drop by $1.2 trillion dollars; 6) 1% of American homes are in foreclosure.
America voted for change in 2006, and we got it!
Remember it's Congress that makes law not the President. He has to work with what's handed to him.
A liberal is a person who will give away everything they don't own.
Yeah I voted for him too... Doesn't mean he's not a retard though. Bush has alot of blame to bear... As do we all. This blame cannot alone be laid at the doorstep of our idiot representatives... It must be accepted by us first for allowing it. we are the idiots who gather towards the type of gossip that allowed us to attack any nation which had not first attacked us. We are the morons who gather all too eagerly to believe every little murmur that the 24/7's "force" into our ears. The blame game is just too easy when it is aimed at "them". We are to blame. You AND me.
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[i]Estimated profit per gallon for Exxon is .10 cents. The feds take you for upwards of .18 cents per gallon. New York gas taxes equal an additional .68 cents per gallon. So who's gouging you now?[\i]
Big Governement could drop your price at the pump in some states by as much as a dollar if they really cared...which is why they haven't.
here's more evidence to prove to you that the oil co's were (note the date) in fact manipulating the prices of gasoline, it was going up while oil was going down:
Exxon Mobil profit rises 10 percent By Joe Carroll Bloomberg News Published: April 27, 2007
HOUSTON: Exxon Mobil, the world's biggest oil company, said Thursday that its earnings rose 10 percent in the first quarter after increasing demand lifted prices for gasoline and diesel fuel, widening profit margins on refining.
"Even though they're not getting as much for the oil coming out of the ground, their whole refining and marketing process is holding up strongly," said Barry James at James Investment Research in Xenia, Ohio.
U.S. retail gasoline prices rose 1.5 cents a gallon, or 0.5 euro cent a liter, from a year earlier while crude prices fell, reducing production costs for refiners. Exxon Mobil, based in Irving, Texas, refines twice as much crude as it pumps from wells.
Gasoline demand in the United States, the world's biggest market for the fuel, rose 1.7 percent during the first quarter, more than twice the rate of growth a year earlier, U.S. Energy Department data showed. The average U.S. profit margin on refining jumped to $12.43 a barrel of oil processed.
there's more facts in the article to support the hypothesis that the Oil Co's are, in general, well in control of the price of fuel...
Exxon made more money this last year off of exploration and oil pumping than they did off refining... Higher commodity prices in the quarter were clearly evident from earnings at Exxon Mobil’s exploration and production arm, known as the upstream. Income rose 32 percent to $8.2 billion from $6.2 billion a year ago. Refining and marketing, or downstream, earnings were $2.3 billion, up from nearly 2 billion in the year-ago quarter, as improved refining operations offset lower U.S. refining margins.
as a matter of fact? the kind of money they "invest" in exploration? 4-5 billion$ would buy one hellofalot of solar panels or wind generators.... the US govt should "encourage" them to consider spending more of their money in this direction IMO...
i personally do not begrudge them their profits. what i do find annoying is how the US Govt has allowed the oil industry to become so non-competitive.
-------------------- Don't envy the happiness of those who live in a fool's paradise.
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Ok, I've lost track of what you're trying to say, Glass.
Let's focus on one article at a time because I think we're coming to two different conclusions using the same information. The Iht.com article starts out with this:
...after increasing demand lifted prices for gasoline and diesel fuel, widening profit margins on refining.
Continuing,
..."Even though they're not getting as much for the oil coming out of the ground, their whole refining and marketing process is holding up strongly"...
That means they are making more money from the refinment and selling of finished produce (using their own oil themselves) than from selling the raw oil to other companies.
...U.S. retail gasoline prices rose 1.5 cents a gallon, or 0.5 euro cent a liter, from a year earlier while crude prices fell, reducing production costs for refiners...
So, they had no need to dramatically increase the cost to the consumer because their production costs were down. 1.5 cents over the course of a year doesn't even keep pace with inflation.
...Exxon Mobil, based in Irving, Texas, refines twice as much crude as it pumps from wells...
Where does the extra oil come from if not from their own wells? Imporation. That means they have to pay the going rate for it, however high that may be.
...Gasoline demand in the United States, the world's biggest market for the fuel, rose 1.7 percent during the first quarter, more than twice the rate of growth a year earlier, U.S. Energy Department data showed. The average U.S. profit margin on refining jumped to $12.43 a barrel of oil processed...
and
...Worldwide demand for refined fuels including gasoline and diesel is expected to rise 1.8 percent this year, according to the International Energy Agency...
As demand increases, both here and abroad prices will increase as well. If China is willing to pay more for a commodity than we are, why would someone not sell to them? Or, if it had enough for both, why sell at less than China is willing to pay?
Now, onto the MSNBC article. After the report about how much money they are bringing in (which you quoted in your post), they talk about where that money came from. Most of the profit was from the selling of crude oil from it's oil fields to refineries all over the world. As we talked about earlier, this price is based on the global market which is influenced by all of the players. OPEC and others like Exxon. No one group gets to set the price any more than one grocery store sets the price of apples. If the store sets the price too high, people will go to another supplier. If it low balls the price, it cuts it's profits while it's competition is still selling at the higher price and making more money to grow their business. Neither makes much business sense. That is why prices (globally speaking) tend to hover around a 'norm' and unless something external affects the market, it remains more or less unchanged.
Oh, one more thing from this article that you didn't post.
...In the U.S., downstream earnings were off sharply from a year ago — $622 million in the most-recent quarter versus $945 million in 2006.
Refining margins — the difference between the cost of crude and what the company makes on refined products such as gasoline — have been squeezed in recent months as spiking oil prices outpaced increases in gasoline prices and other refined products...
Wait, did that say Big Oil's profit from the refinement and selling of gasoline has gone DOWN? You mean they aren't making more money off of us gas addicts than they were in the past? How could that be? It's because the rising oil may help one division of Exxon Mobil, but it also hurts it's profit margin in another. It has to buy oil to refine (at it's current outputs of both). The rising costs don't help it in this field.
If you feel that I've misunderstood what your articles mean, please show me how you read the same information. Finally, a mostly rhetorical question but feel free to answer. In our capitalist society, what kind of 'encouragment' would you want the government to assert on Big Oil (or any other company making a legal profit)? The carrot, or the stick?
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