Skip to main content
Update
Non-financial boards have been closed.

Non-financial boards have been closed but will continue to be accessible in read-only form. If you're disappointed, we understand. Thank you for being an active participant in this community. We have more community features in development that we look forward to sharing soon.

Fool.com | The Motley Fool Community
Message Font: Serif | Sans-Serif
 
No. of Recommendations: 3
Exxon Mobil, Chevron, and ConnocoPhillips, combined to make 63 billion in profit, that's PROFIT, the money that is left over after they have paid all their bills, in 2005.

Someone want to explain to me again how gas is now at 2.29 a gallon because of the increased COSTS, that the oil companies have.
Print the post Back To Top
No. of Recommendations: 3
Someone want to explain to me again how gas is now at 2.29 a gallon because of the increased COSTS, that the oil companies have.

Because that is the price that you and your local gas station have agreed upon for you to procure his gasoline for. If its too high, don't buy it. If its too low, he shouldn't sell it.

Level of profit is irrelevent...... unless you want to get into the game of deciding what everybody is worth. In that venue, I would point to government employees as making the very most for the pathetic utility they provide.
Print the post Back To Top
No. of Recommendations: 0
Exxon Mobil, Chevron, and ConnocoPhillips, combined to make 63 billion in profit, that's PROFIT, the money that is left over after they have paid all their bills, in 2005.

Someone want to explain to me again how gas is now at 2.29 a gallon because of the increased COSTS, that the oil companies have.

==============================


Good thing that Bush and other Administration officials do not come from the oil industry ;-)


Want to guess how many top Admin officials will be at lucrative jobs with the oil or drug industries within 2 years after their "reign"?

Heard of golden parachutes?.....they will get Diamod Parachutes


Print the post Back To Top
No. of Recommendations: 0
Exxon Mobil, Chevron, and ConnocoPhillips, combined to make 63 billion in profit, that's PROFIT, the money that is left over after they have paid all their bills, in 2005.

Someone want to explain to me again how gas is now at 2.29 a gallon because of the increased COSTS, that the oil companies have.


Sorry Ray, can't. That concept baffles me too. Maybe if the 63 billion was reinvested into building new refineries or finding alternate sources of energy, or paid out to the stock holders, then I would understand it.

But I've seen no benifit from the profits passed onto the consumer, just higher prices. Gas is 2.15 here.

philz
Print the post Back To Top
No. of Recommendations: 0
Good thing that Bush and other Administration officials do not come from the oil industry ;-)


Want to guess how many top Admin officials will be at lucrative jobs with the oil or drug industries within 2 years after their "reign"?

Heard of golden parachutes?.....they will get Diamod Parachutes


What specific measures has the Adminstration put into practice to juice up the oil company profits? The Iraq War? Did they hand the keys to Iraqi oil wells over to Conoco or Exxon Mobil? War to disrupt supply and shift prices up? Is Cheney the Czar of the American price fixing oil cartel? What's the angle?
Print the post Back To Top
No. of Recommendations: 1
Level of profit is irrelevent

Not when the companies are crying poor it isn't. And not when it is a company that pretty much has everyone over a barrell. It is very easy to say, "Don't buy the gas if you don't like the price." But it isn't very practical. There are many things that I don't buy because I don't like the price. I don't have cable, I don't go to Rolling Stones concerts, I don't eat at 4 star restaraunts every night for dinner.

All of those things are just fine for anyone to gouge the consumer as much as they want.

But oil is a need. If I don't buy gas, I don't get to work. Now, I suppose I could stop working, I certainly am not one of those people that loves my job. But, I doubt that you love your job so much that you are willing to pay me to not work, are you?

When the price gouging started, the companies said it was the increased cost of doing business that drove gas prices up. If that had been true, then the logical result would be that profits would remain flat or even decrease. That profits have increased shows that costs did not increase, meaning that we were lied to. The oil companies have engaged in price gouging, plain and simple.
Print the post Back To Top
No. of Recommendations: 0
The oil companies have engaged in price gouging, plain and simple.


They always have. This is nothing new Ray.
Print the post Back To Top
No. of Recommendations: 2
Someone want to explain to me again how gas is now at 2.29 a gallon because of the increased COSTS, that the oil companies have.


Believe it or not, it is estimated that the Oil companies in these boom times of high trading prices (speculators set the trading prices) have managed to keep about a dime a gallon. That is a lot on the base of past oil company gas profits.

But, depending on where you live, the minimum State and Federal tax runs about about 20 cents on the dollar, or say $0.45 on your $2.29 gallon to the oil comnpanies dime.

Now, Exxon's Oil will be comming out of the ground at $ 60.00 a barrel.

The Windfall of last Q's $55 to $70.00 price fluctuations that allowed some profits due to the oil speculators may or may not come back.

But then everyone wants those new refineries ... California wants its special blends ..

Bears
Print the post Back To Top
No. of Recommendations: 0
They always have. This is nothing new Ray.

Maybe I would like to gripe a bit about it. As I said, they have us all over a barrell. There is nothing that can be done about it, save not buying gas. And since that isn't practical, they only thing left is tilting at windmills on the internet.
Print the post Back To Top
No. of Recommendations: 2
But oil is a need. If I don't buy gas, I don't get to work. Now, I suppose I could stop working, I certainly am not one of those people that loves my job. But, I doubt that you love your job so much that you are willing to pay me to not work, are you?

Your need does not justify an obligation for somebody to fulfill it at a price you think is "fair". You have no more right to affordable gasoline than you do healthcare. Despite popular belief people are entitled to healthcare, smart people that get medical degrees should get payed what they are freely willing to work for. Similarly, people that produce gasoline should sell their production for what price than can demand and receive.

Now if you have compelling evidence of collusion and price fixing, you have a legitimate beef. But, "price gouging" is merely a higher price than you think you should pay. I think ambulance chasing lawyers make too much money and cost us far more than evil oil companies. But, on the other hand, I think those dirtbags should make what people are willing to pay them also.
Print the post Back To Top
No. of Recommendations: 1
Believe it or not, it is estimated that the Oil companies in these boom times of high trading prices (speculators set the trading prices) have managed to keep about a dime a gallon.

So if the cut their prices in half and only made a nickely a gallon, they would still have made 31.5 billion in profit last year.
Print the post Back To Top
No. of Recommendations: 0
2.29 a gallon

What should a gallon of gas cost? Why?

Print the post Back To Top
No. of Recommendations: 0
So if the cut their prices in half and only made a nickely a gallon, they would still have made 31.5 billion in profit last year.

Obviously, they didn't have too. Perhaps, we should have gotten into the oil business.
Print the post Back To Top
No. of Recommendations: 1
Now if you have compelling evidence of collusion and price fixing,

Every gas station in town charges the exact same price. In any other industry, that would be all the evidence you needed.
Print the post Back To Top
No. of Recommendations: 0
Every gas station in town charges the exact same price. In any other industry, that would be all the evidence you needed.

I would suggest you go to your state corporation commission if you really think they are colluding prices. It varies 5 to 10 cents a gallon in our area. Gasoline is commodity. Beyond cool sounding additives like Techron, there really is much differentiation of product to make. It is pretty predictable that price spread would be quite narrow in a competitive market.
Print the post Back To Top
No. of Recommendations: 0
What should a gallon of gas cost?

$1.15

Why?

Becuase it is more affordable to the general public that needs the gas and it still allows the companies to my over 30 billion in profit.
Print the post Back To Top
No. of Recommendations: 2
Obviously, they didn't have too. Perhaps, we should have gotten into the oil business.

BWAHAHAHAHAHAHAHAHAHAHAH

We're all in the oil biz whether we like it or not.

What do you think Iraq is about.

Yeah, I know. George and Dick couldn't sleep nights knowing Iraqis didn't have a democratic government. Oil didn't have a thing to do with it.

Hey, at least in British colonial days the freakin' companies hired their own thugs.


Print the post Back To Top
No. of Recommendations: 0
Becuase it is more affordable to the general public that needs the gas and it still allows the companies to my over 30 billion in profit.

Why do they get 30 billion? How about $ 1.10 and 10 billion in profit? Why should they get any profit? Maybe we need a pricing authority to establish fair prices and sensible profits. You want to head that up?
Print the post Back To Top
No. of Recommendations: 1
Believe it or not, it is estimated that the Oil companies in these boom times of high trading prices (speculators set the trading prices) have managed to keep about a dime a gallon.

So if the cut their prices in half and only made a nickely a gallon, they would still have made 31.5 billion in profit last year.



Yes. and investors would head for the hills .... as the Dividend yield drops from $2 to $1


Oh .. That right

Liberal / Socialist

Liberal / Socialist

Liberal / Socialist

I keep forgetting

Bears
Print the post Back To Top
No. of Recommendations: 0
If its too high, don't buy it


Sorry Coyote, i wish the world was as simple as not buying gas.


ramseesforever
But i have reduced my consumption by taking mass transit
Print the post Back To Top
No. of Recommendations: 1
Maybe we need a pricing authority to establish fair prices and sensible profits. You want to head that up?

I would love to head it up. But the conservatives don't want me to head it up because I would allow the oil companies to make 30 billion in profit and the liberals don't want me to because I would allow the oil companies to make 30 billion in profit.

Print the post Back To Top
No. of Recommendations: 1
I would love to head it up. But the conservatives don't want me to head it up because I would allow the oil companies to make 30 billion in profit and the liberals don't want me to because I would allow the oil companies to make 30 billion in profit.

Oh no, you can't stop there. You need to decide what everyone should rightfully make. Drug companies, grocers, farmers........... Interesting the beef with oil companies for obscene profits and unfair high prices........ the beef with Wal-Mart obscene profits and unfair low prices. Its all about those evil profits.
Print the post Back To Top
No. of Recommendations: 0
Sorry Coyote, i wish the world was as simple as not buying gas.

It is that simple. It is in regard to those evil profits. Now monopoly control and collusion are an entirely other matter. But, bemoaning about excessive profits in itself is a truckload.

I will give Ray credit..... he had the gumption to suggest the rightful price and why. I don't agree. But, he had the gumption to put a number to his indignation. Prices, and profits are not arbitrary values subject to anyone's whim.
Print the post Back To Top
No. of Recommendations: 1
Oh no, you can't stop there. You need to decide what everyone should rightfully make. Drug companies, grocers, farmers........... Interesting the beef with oil companies for obscene profits and unfair high prices........ the beef with Wal-Mart obscene profits and unfair low prices. Its all about those evil profits.


What do you plan to do when you get priced out of every market, coyote? I pray it doesn't happen to you, but for a lot of people that is the simple fact of life. They have all but abandoned any thought of buying wants and are struggling to buy their needs. It would probably be easier if they just quit working and went on welfare, but that isn't a part of their value system. They believe that people should work. And they are willing to work. But they only jobs available to them are low-paying jobs. For some odd reason, that low paying job is in a neighborhood where housing is expensive, so they live quite a distance away from their job. It's too far to walk, there is no public transportation, so all that is left is a car. What are they supposed to do when there job will not pay them enough to be able to afford gas to come to work?
Print the post Back To Top
No. of Recommendations: 0
What do you plan to do when you get priced out of every market, coyote? I pray it doesn't happen to you, but for a lot of people that is the simple fact of life. They have all but abandoned any thought of buying wants and are struggling to buy their needs. It would probably be easier if they just quit working and went on welfare, but that isn't a part of their value system. They believe that people should work. And they are willing to work. But they only jobs available to them are low-paying jobs. For some odd reason, that low paying job is in a neighborhood where housing is expensive, so they live quite a distance away from their job. It's too far to walk, there is no public transportation, so all that is left is a car. What are they supposed to do when there job will not pay them enough to be able to afford gas to come to work?

What do you plan to do to prevent people from getting priced out of markets? Planned economies have a dismal record. Price controls don't work. There is far more wrong with the system than gas prices. Cheap gas isn't going to fix it. Meddling with the market of commodities only makes it worse.
Print the post Back To Top
No. of Recommendations: 0
Seems supply and stocks are OK, well above average, despite the hurricanes and plagues.

http://tonto.eia.doe.gov/oog/info/twip/twip.asp

Could get a cold snap and I suppose summer driving season is only five months away so can't be too careful. The transit system is an interesting idea. They make the old folks here stand in 110 degree heat with no bus shelter so alot of them don't use it much. Wimps. They are spending a billion on one of those cool rapid transit trains that go six blocks downtown.

I see XOM spent about as much for the quarter and year on stock buybacks as on exploration. 18 billion-ish.

Anyway, supply not really a problem. Maybe making up for the malaise of the 1990s when a barrel bottomed out about 10 dollars with about the same petroleum stock levels. Imagine trying to rebuild Iraq on that kind of pocket change.
Print the post Back To Top
No. of Recommendations: 0
What do you plan to do to prevent people from getting priced out of markets?

I am glad you asked. Universal Health Care. It will be expensive in the short term for the government to run our health care system, but in the long term, I believe that it will be very beneficial. It will free up a lot of money that cooperations currently spend on health care. GM figured that out which is why they called for UHC. Additionally, it will create mobility for the labor force. I bet you have met quite a number of people who are scared to change jobs or to try and start their own business becuase they are worried about losing their health care. Take that concern away, and watch what happens. I have done a lot of reading and studying about many things economic and I am convinced of one thing. America is heading for a crash that will make us long for the days of the Great Depression when everyone was rich. <sarcasm for those who need the hint>

A radical shakeup is the only thing that will head it off and the only thing that can be radically shookup without causing more problems is health care.
Print the post Back To Top
No. of Recommendations: 0
A radical shakeup is the only thing that will head it off and the only thing that can be radically shookup without causing more problems is health care.

I agree. Though universal healthcare coverage is not the shakeup I would make. I would eliminate third party payment preference created by government meddling...... essentionally destroying the incentive for employers to provide healthcare coverage and destroying the paradigm of what healthcare insurance should be. Insurance would return to catastrophic coverage which is what it should rightfully be. I have done a lot of reading and studying about many things economic also. I am also convinced that America is on a crash course. I am also convinced that more government is not the solution. Quite the contrary, far less of it is.

I have no interest at all in waiting in lines for crappy care. I think that is the inescapable reality of universal care. In fact, I would rather have the mess we have now than that.
Print the post Back To Top
No. of Recommendations: 0
Maybe I would like to gripe a bit about it. As I said, they have us all over a barrell. There is nothing that can be done about it, save not buying gas. And since that isn't practical, they only thing left is tilting at windmills on the internet.

I'd like to gripe about it too but I don't think it's going to make any difference. Oil companies and OPEC are nothing but a monopoly. I though we had laws against monopolies.
Print the post Back To Top
No. of Recommendations: 0
I'd like to gripe about it too but I don't think it's going to make any difference. Oil companies and OPEC are nothing but a monopoly. I though we had laws against monopolies.

I wouldn't whine too much. At $ 2.30 a gallon we are right in line with 1950's prices for gasoline. Perhaps, a little perspective is in order and we should be just giddy about the smoking deals we have been getting the last twenty years. Or, perhaps gas should just keep getting more affordable like electronics.

http://www.jewishworldreview.com/cols/williams083105.asp

In 1950, a gallon of regular gasoline sold for about 30 cents; today, it's $2.50. Are today's gasoline prices high compared to 1950? Before answering that question, we have to take into account inflation that has occurred since 1950. Using my trusty inflation calculator (www.westegg.com/inflation), what cost 30 cents in 1950 costs $2.33 in 2005. In real terms, that means gasoline prices today are only slightly higher, about 8 percent, than they were in 1950. Up until the recent spike, gasoline prices have been considerably lower than 1950 prices.

Another good piece on the evil oil price gouging:

http://www.jewishworldreview.com/cols/williams110905.asp
Print the post Back To Top
No. of Recommendations: 0
In 1950, a gallon of regular gasoline sold for about 30 cents; today, it's $2.50. Are today's gasoline prices high compared to 1950? Before answering that question, we have to take into account inflation that has occurred since 1950. Using my trusty inflation calculator (www.westegg.com/inflation), what cost 30 cents in 1950 costs $2.33 in 2005. In real terms, that means gasoline prices today are only slightly higher, about 8 percent, than they were in 1950. Up until the recent spike, gasoline prices have been considerably lower than 1950 prices.


Why was 1950 used as the base line? Could gas higher in 1950 than preceding years? I remember as a kid growing up in the mid to late 60's that gas fluctiated between 25 to 29 cents a gallon.
Print the post Back To Top
No. of Recommendations: 1
Why was 1950 used as the base line? Could gas higher in 1950 than preceding years? I remember as a kid growing up in the mid to late 60's that gas fluctiated between 25 to 29 cents a gallon.

I am sure Williams picked a year that best suit his point.

Gasoline prices are volatile. But, Williams cherry picking does not invalidate the idea that it kind of dillutes the melodrama of obscene gasoline prices borne by Working Class Joe when another generation dealing with the same burden is pointed to. I am not familiar with 1950 specifically. Perhaps there were similar sky is falling, "peak oil", or similar resource exhaustion scares at the time. Perhaps, additional reserves were found in 1952.

Now if people want to become particularly vulnerable to the end of reserves, just control prices. That will have the impact of reducing alternative fuel development and disincentivizing conservation..... however, consumption will go down as we wait in line for gasoline.

We have learned enough lessens about price controls. I don't necessarily disagree with Ray's sentiments. I am whole heartedly for market fairness. I would oppose collusion measures and would support some measures of anti-trust. What I disagree with is bemoaning profit levels whatever they may be....... with no compelling case of such shenanigans presented with it. My central point is that what somebody deems "excessive profits" is not necessarily evil and certainly in itself not a reason for outrage.
Print the post Back To Top
No. of Recommendations: 0
Your need does not justify an obligation for somebody to fulfill it at a price you think is "fair".

Well that depends, are they selling me my oil or someone else's oil?

If the oil their selling me is from oilfields leased from the federal goverment, than it's my oil and I should dang well have a say in how much profit they can make from national resources.

If they want to take more national resources to sell to me, I dang well should have a right to comment on how much profit they make on that national resource.

If, on the other hand, their getting their oil from foreign sources, and they are not calling on my goverment to pressure other goverments to give them good deals, than I certainly have no beef.

And since all of the above is happening, I think all Americans have the right to question just how much of those profits came about from either national resources or calling on the goverment for help elsewhere.

Mind you, that is probably more complicated a discussion(trying to figure out how much oil companies get subsidized by the goverment, how much is from national resources and how much from privately owned resources, or other nations resources). It certainly is easier for citizens to complain about price gouging. And oil companies certainly don't wantr to open the books and show everyone where it all comes from.

So I guess there seems to be three options:
1) Pretend all the oil comes from private resources so we can apply a simplistic captialist model to the oil companies.

2) Pretend there is a magic profit number above which they are gouing everyone and complain about that.

3) Ask for a detailed and true analysis.

I vote for 3. :-)
Print the post Back To Top
No. of Recommendations: 0
I have no interest at all in waiting in lines for crappy care. I think that is the inescapable reality of universal care.


Why do you think that?
Print the post Back To Top
No. of Recommendations: 0
I would eliminate third party payment preference created by government meddling...... essentionally destroying the incentive for employers to provide healthcare coverage and destroying the paradigm of what healthcare insurance should be. Insurance would return to catastrophic coverage which is what it should rightfully be.

That would certainly price even more people out of health care than have it today.

I have no interest at all in waiting in lines for crappy care. I think that is the inescapable reality of universal care. In fact, I would rather have the mess we have now than that.

I don't believe that we would have crappy care. Look at medicare. Our seniors are living longer than ever now, even though they have all the problems of a government health system to deal with.

Print the post Back To Top
No. of Recommendations: 0
I wouldn't whine too much. At $ 2.30 a gallon we are right in line with 1950's prices for gasoline.

I have spoken with people that lived in the 1950's and they all say that's bull.
Print the post Back To Top
No. of Recommendations: 0
So if the cut their prices in half and only made a nickely a gallon, they would still have made 31.5 billion in profit last year.
____________________


Just curious if you have any idea what you are talking about?

Yes there is amore money flowing through the system, and the oil companies facing heavier risks and more cash outlays than ever before are finding profits.

Now to the misguided part of your post. They CAN cut by a nickle, and that would return their profit to where it was last year, maybe a little less. They can cutr by 11 cents and lose money. What would that really do Ray? Is that what you really want? They can't cut their price in half, it doesn't work that way, the per gallon price carries very little profit - as was said and you constantly filter through without seeing. Per gallon they are making a friggin dime! The government is making better than twenty cents. but OH MY GOD THEY ARE MAKING BILLIONS - boo friggin hoo hoo hoo - they sell an awful lot of gas. Put on your thinking cap on this issue please.

You want to save a nickle, OK moan at the gas companies. The rest are fixed costs - that Ray is why all the companies charge about the same amount the costs are fixed for shipping, for crude for refining, for exploration etc - and that leaves very little room from company to company.
Print the post Back To Top
No. of Recommendations: 0
I have spoken with people that lived in the 1950's and they all say that's bull.

Most people in the 1950's were not stupid enough to borrow against their home to buy a TV, Vacation and New Caddi.

They did not have Credit cards and made it a point to live on budgets and pay cash.

The average 1950's salary was Average Salary: $2,992 or $57.00 a week

The price of gasoline in 1950 was 27 cents a gallon, or 10% of your weekly salary for 20 gallons.

An average house would have cost you $14,500 or 11 to 12 years salary, abiut comperable to now, or now may be less.

Ford car: $1339-$2262 Less or about the same depending on model

Campbell's Pork & Beans - (2) 1 lb. cans: $.25 ?

Bears

Print the post Back To Top
No. of Recommendations: 0
THEY ARE MAKING BILLIONS

They are making billions and crying poor while making those billions. I don't buy any of their crap about so-called fixed costs. Oil companies are like Walmart. They crack the whip. Everyone down the line does what they say.
Print the post Back To Top
No. of Recommendations: 1
I don't buy any of their crap about so-called fixed costs.
__________________

OK nuf' said. Reality doesn't fit your world view, so you'll just create a new one. Cool.
Print the post Back To Top
No. of Recommendations: 2
Try this for reality, how about I quit my job becuase I can't afford to buy gas anymore and we raise your taxes to support me living on welfare for the rest of my life.
__________________________


OK so you're turning into a true liberal. What does that have to do with whether the oil companies have fixed costs and that is largely why gas goes up?

What does that have to do with then making a dime on a gallon?

How's about you pull your teeth out leave them under your pillow and beg the tooth fairy for 30k per? Then we can be all smiles(well gummy smiles anyway). Friggin tooth fairy won't go along? Now you have two bogey men that won't play by rules we may want to make up that have nothing to do with facts.

Print the post Back To Top
No. of Recommendations: 1
Reality doesn't fit your world view

Reality is that people can't afford to pay these high gas prices. We are living on borrowed time. The oil companies are obsessed with getting everything they can right now and they don't care what else happens because they have their money stashed away in the Cayman Islands, so they will be able to ride out the crash that is coming. Shame that isn't the case for the janitor that cleans the oil companies HQ buildings.
Print the post Back To Top
No. of Recommendations: 0
That would certainly price even more people out of health care than have it today.

No, it wouldn't. Third party payment is the biggest factor impacting rising healthcare costs. People that can not pay their own medical bills is an entirely separate issue. We do not nationalize the food supply because some people can't afford food. We don't confiscate additional wages and issue housing allowances to everyone because some can not afford housing.

I don't believe that we would have crappy care. Look at medicare. Our seniors are living longer than ever now, even though they have all the problems of a government health system to deal with.

I disagree. I don't find what you point to very compelling. Life expectancy has generally increased throughout the history of man. Further, seniors makeup a minority of healthcare patients and receive care in what is otherwise private care facilities. The landscape of care will change greatly when Uncle Sam has a monopsony position in procurement. Bank on it.
Print the post Back To Top
No. of Recommendations: 0
OK so you're turning into a true liberal.

There is no need to insult me. We are just having a nice conversation and you decide to sucker punch me? That's just not right. How would you like it if called you a liberal? That's right, you wouldn't.

As for the oil companies make a dime on a gallon of gas, I called bull because that is what I believe. When something looks like crap and smells like crap, it usually is. I know more believe the oil companies about that, than I believe the baseball stadium concession company that claims to only make a dime on 5 dollar hot dog.
Print the post Back To Top
No. of Recommendations: 3
Because that is the price that you and your local gas station have agreed upon for you to procure his gasoline for. If its too high, don't buy it. If its too low, he shouldn't sell it.

What you avoid about this situation is that these companies are sitting on a resource that is now required for living. It's practically like water, we can't do much without it. It's a resource that is entrenched in our society. Effectively it is a technology monopoly.

This bit about "don't buy it" is naive on two counts. First, competition in the marketplace to bring prices down strives against "charging what the market will bear". I'm not suggesting the oil companies are colluding on price (though they might be), but each one is striving to go as high as possible without losing customers...which leads to the second:

Most people aren't interested in a price difference of 2 cents per gallon depending on which side of the street they are on. The price fluctuations are daily, and who has time to constantly monitor the cheapest price on gas? Good grief, there is enough to do in life, without that. So we pretty much buy gas wherever it's convenient...because we have to.

The combination of gas being a required resource combined with a pricing that is pretty much outside of consumer control leads to continual profits and an overbearing economic and political clout by the oil industry.

Your ideas of "free market" are textbook, and completely outside reality.
Print the post Back To Top
No. of Recommendations: 1
Your ideas of "free market" are textbook, and completely outside reality.

No, the ideas are not outside reality. I didn't "avoid" either factor you point to either. Everyone is striving to maximize the profit of their endeavors. Wal-Mart strategizes making price low (or in the least developing low price perception) for high volume sales. Oil companies optimize price. They could charge more, but demand would go down. It is no different, than individual home owners shamelessly pricing homes out of touch to many hard working families. Evil bastards selling homes for far more than they paid just a brief time ago. Now if people aren't interested in shopping gas prices, they should not whine about prices. They have created the strategy of stations to no worry so much about price. In regards to the techonology monopoly.... I will grant that there are far fewer oil companies than I would like to see. But, none of them have a monopoly. Now, there may well be collusion. There is also some quite shady subsidy practices with the oil industry. But, those are entirely other distinct subjects from whining about prices being too high and profits too much in itself.

Finally, for everybody whining about greenhouse gases, peak oil, and all of the other hysteria...... higher prices are doing them a favor. They should applaud the higher prices and encourage them to go up. There are alternatives to gasoline. You could ride a bike. You could have bought an electric car. You could have gone with an alt. fuel vehicle. Those options not practical? Perhaps, gasoline isn't high enough yet.
Print the post Back To Top
No. of Recommendations: 0
The bigger your vehicle, the richer they get. The more oil stocks you own, the richer you get.

Regards, Teddy (who drives a ten year old Miata and owns 400 shares of XOM ...well, duh!)
Print the post Back To Top
No. of Recommendations: 0
You could ride a bike. You could have bought an electric car. You could have gone with an alt. fuel vehicle. Those options not practical? Perhaps, gasoline isn't high enough yet.

What an incredibly stupid statement.
Print the post Back To Top
No. of Recommendations: 1
In regards to the techonology monopoly.... I will grant that there are far fewer oil companies than I would like to see.

That's not quite what I meant. I meant about the resource itself. Our society is locked into this one fuel for our economic engine.

But, none of them have a monopoly. Now, there may well be collusion. There is also some quite shady subsidy practices with the oil industry. But, those are entirely other distinct subjects from whining about prices being too high and profits too much in itself.

I don't think it's a distinct subject. You have to look at the package as a whole because one element feeds off another. All of them bound together have created this situation.

Finally, for everybody whining about greenhouse gases, peak oil, and all of the other hysteria...... higher prices are doing them a favor.

I agree, and while I infrequently drive my Corolla around I appreciate what this is doing for the alternative energy sector.

Yet I do wonder why federal tax money (your money) is being handed to the oil companies to offset some of their costs. It's against both our short-term and long-term interests. In the short-term, $15 billion could be put to a lot better use in education, health care, electoral reform, roads, whatever. In the long-term, anything we do to prop up the oil industry only lengthens the amount of time we are hostage to this one resource.

Alternatives need to be developed for many reasons, not least of which are to break the stranglehold the oil companies have on our political process.
Print the post Back To Top
No. of Recommendations: 0
They are making billions and crying poor while making those billions. I don't buy any of their crap about so-called fixed costs. Oil companies are like Walmart. They crack the whip. Everyone down the line does what they say.

I think you're missing something...

Say there is this barrel of crude that sells for $30 today. Company A acquires it and refines it to make gasoline. Tomorrow there is a spike in demand, and the price of the barrel goes up to $60. What price of oil is the price of the gas in the refinery contingent on, the $30 or the $60?

The answer is $60. Why is that, when it only cost them $30? Because they still have to buy another barrel, and that barrel is going to cost them $60 now and possibly more in the future. They will certainly make a huge profit on the gas in the short term, but those profits will have to be sunk into buying more supply at much higher prices in the future. This huge profit is necessary for them to stay in business tomorrow.

What are the oil companies doing with this money? Are they stacking it up and cliff-diving off of it? Are they paying it all out to their shareholders? Their executives? No. They're saving some to ensure they can continue operations in the down times and most of the rest is being invested in new technologies which will allow them to extract more oil, even at much higher prices. And yes, some does go to the shareholders, executives and other employees... that's the entire reason they work, to make money. However, the way some people make it sound you'd think they are planning on building a golden bridge to Hawaii with the money!

Nobody likes paying over $2 for a gallon of gas after paying far less than that for decades... but nobody likes paying for anything really. It's just something you have to do to be fair and so the system can work. There are alternatives, such as price controls and the like, but history has shown them to be far worse (which is why I'm vehemently against Universal Healthcare).

Mike
Print the post Back To Top
No. of Recommendations: 2
What an incredibly stupid statement.

Why is it stupid? I think it makes perfect sense!

What is the role of prices? They are signals to the market that allow it to allocate resources efficiently. What does that mean? When supply is high and demand is low, low prices dissuade providers from further swamping the market. When supplies are low and demand is high, it tells supplies that there is a dire need and gives them an incentive to meet it. On the consumer side high supply and low demand (low prices) encourages them to increase demand and reduce the supply (storage costs money and is an inefficiency). Low supply and high demand (high prices) tells the consumer to conserve the supply, or seek out alternatives.

So, high gasoline prices are nothing more than the market's way of telling you (the consumer) to conserve gas by driving less, buying a vehicle with better gas mileage, etc. or seeking alternatives such as riding a bicycle or buying a vehicle that runs on alternative fuels. Just because it may not be applicable to do these things right now for you doesn't mean that these aren't acceptable alternatives for any consumers. If the consumers don't change their activities (they ignore the market signals) the market will keep raising prices until they are forced to do so... that is the role of prices after all.

This isn't some grand conspiracy, it's just the best way to make sure resources are allocated correctly. The alternative, having some group (or person!) determine prices by somehow divining the millions of decisions buyers and sellers come to in order to determine prices (which the market handles quite well) isn't nearly as effective. It takes longer to get to the right answer (if at all), which leads to supply problems on one sort or another... which leads to more cost for the consumer, not less. In other words, if you think things are bad now, they could certainly be much worse!

Mike
Print the post Back To Top
No. of Recommendations: 1
They're saving some to ensure they can continue operations in the down times and most of the rest is being invested in new technologies which will allow them to extract more oil, even at much higher prices.

You sound like you believe this. I sorry my trust went out the window with Enron.
Print the post Back To Top
No. of Recommendations: 1
In other words, if you think things are bad now, they could certainly be much worse!

And they are gonna get worse. Meanwhile telling people to buy new cars or walk 30 miles to work every day is not a reasonable solution.
Print the post Back To Top
No. of Recommendations: 1
What an incredibly stupid statement.

No Ray. The incredibly stupid statements were the ones whining about people making too much money and the inferences that gas should cost what you think it should cost.

If that's the way you want to play. I am disappointed Ray, normally you are above this sort of crap. No wonder the lefties have become enamored with you lately.
Print the post Back To Top
No. of Recommendations: 0
Thank you for a respectful reply. Are you feeling ok? :-) Ray seems a little under the weather.
Print the post Back To Top
No. of Recommendations: 0
There is no need to insult me. We are just having a nice conversation and you decide to sucker punch me? That's just not right. How would you like it if called you a liberal? That's right, you wouldn't.
_______________________


Hey Ray,

Didn't mean to sucker punch you there, it was a tongue in response to you going on the dole and living on welfare. It wasn't really part of my comments at all on the thread.
I try not to call anyone a lib who is smart enough to realize it is not a compliment.
Print the post Back To Top
No. of Recommendations: 0
The incredibly stupid statements were the ones whining about people making too much money

There is a point that the only reason for making so much money is pure greed. That is morally reprehensible. An oil company, a movie star, a pro athlete, the local mechanic who rips you off. It's all that same. I understand and support any business in their pursuit of a healthy profit. What these people are doing, while at the same hurting the most vulnerable on the economic spectrum is inexcusabe.

And don't worry about what the lefties think of me. I am making a moral judgement here - not something liberals are comfortable with.
Print the post Back To Top
No. of Recommendations: 0
There is a point that the only reason for making so much money is pure greed. That is morally reprehensible. An oil company, a movie star, a pro athlete, the local mechanic who rips you off. It's all that same. I understand and support any business in their pursuit of a healthy profit. What these people are doing, while at the same hurting the most vulnerable on the economic spectrum is inexcusabe.

Really? Its all the same? So a movie star is acting akin to a crooked mechanic because you deem he makes too much money? Perhaps next go around you can be the profit deity and determine what is healthy for everybody. Perhaps, you are too greedy and have things you really don't need while children go hungry in this world.

Those evil profits.
Print the post Back To Top
No. of Recommendations: 1
Perhaps next go around you can be the profit deity and determine what is healthy for everybody. Deal.

Perhaps, you are too greedy and have things you really don't need while children go hungry in this world. No question about that. I imagine that is true of all of us on here.

Print the post Back To Top
No. of Recommendations: 0
No question about that. I imagine that is true of all of us on here.

Indeed its all in degrees. Personally, I think you should earn what you can doing what you want and share it how you please. I chuckle everytime one particular poster pontificates about evil capitalists in between musings about his/her world travels.
Print the post Back To Top
No. of Recommendations: 1
on the oil companies. Neil Bortz was railing today about the teddys and chuckies grandstanding over the oil profits. He said, sure the number sounds "fantastic", but does anyone pay attention to the key number?

called PROFIT MARGIN. Can't remember which companies numbers he was talking about, but he mentioned, yes, they made 36 Billion dollars in profit. But that it came to a PROFIT MARGIN of 8%... Which is less than a majority of the other companies doing business.

do you know how much this same company paid in taxes, state and FED last year? get this number: 98 Billion dollars in taxes.

Print the post Back To Top
No. of Recommendations: 0
I am making a moral judgement here - not something liberals are comfortable with.

LOL, how wrong you are.
Print the post Back To Top
No. of Recommendations: 0
I understand and support any business in their pursuit of a healthy profit.

ah, the opening needed. What is pray tell, an acceptable profit? Or shall we talk in business terms and say, what is an acceptable profit margin for an oil company??
Print the post Back To Top
No. of Recommendations: 0
You sound like you believe this. I sorry my trust went out the window with Enron.

I was an Enron investor, so I definitely see your point. However, Enron also got caught and punished, under the "old" rules at that. This is but one price to pay for trying to cheat the system.

I'm not claiming that the free market system is perfect in this regard, or any regard. Coming up with a perfect system is impossible. However, the free market approach is better than the alternatives. If a certain company is regarded as crooked, it will pay a price in the marketplace for that. People boycott companies they consider to be crooked all of the time (such as Coca-Cola, Microsoft, Wal-Mart, Intel, etc.) That's also an aspect of the free market, the consumer has a choice.

Mike
Print the post Back To Top
No. of Recommendations: 1
And they are gonna get worse. Meanwhile telling people to buy new cars or walk 30 miles to work every day is not a reasonable solution.

But that isn't the only alternative. Carpooling is one option for some. Telecommuting is an option for some. Selling one's current car and buying a more efficient model is another option. There are many, many options out there. Each has a cost associated with it, of course, and once that cost is exceeded by the regular option (driving to work in this case) then these other options become cost effective. For example, paying an early termination fee on a lease would end up being cheaper than paying to gas up a gas guzzler over the term of the lease at some price-point.

This is the market's way of forcing people to conserve, and it's brilliant. It uses your desire to get the most bang for your buck as a means to get you to do things you may not want to do for the good of all. Put it this way, are people going to conserve gasoline because they should, or because they have to? Pinning your hopes on people doing what they should do (especially if they don't want to) is a losing proposition. But if you make them choose between conserving gas and starving, they'll conserve one way or another. Sure, it's harsh, but there will still be gas at the pumps that way. If there are shortages nobody benefits.

Mike
Print the post Back To Top
No. of Recommendations: 0
This is the market's way of forcing people to conserve, and it's brilliant.

None of you seem to be able to come to grips with the main flaw with the current system:

Alternatives need to be developed for many reasons, not least of which are to break the stranglehold the oil companies have on our political process.

Simply buying a more efficient car isn't going to help.
Print the post Back To Top
No. of Recommendations: 0
But that it came to a PROFIT MARGIN of 8%... Which is less than a majority of the other companies doing business.

Good point! One of the investing guidelines TMF extolled (maybe they still do) was that you want to look for net profit margins above 7%. Now 8% is above 7%, but not by much. There are many, many other companies with net profit margins well above 8% (Microsoft's net profits dwarf this number).

So that number really doesn't impress me all that much, even if it is a record when it comes to dollar amounts. It's the percentages that really matter, and they never really point those out when they're on these rants, do they?

Mike
Print the post Back To Top
No. of Recommendations: 0
Alternatives need to be developed for many reasons, not least of which are to break the stranglehold the oil companies have on our political process.

I agree, partially (not for the stated reason, but in general.) But high priced gas would make the massive investments needed to come up with acceptible alternatives far more palatable, would it not? The question is whether or not the prices are high enough yet for this to be the case. It doesn't appear to be the case yet, people are complaining but there doesn't seem to be a massive call for something to be done about it quite yet.

Mike
Print the post Back To Top
No. of Recommendations: 1
People boycott companies they consider to be crooked all of the time (such as Coca-Cola, Microsoft, Wal-Mart, Intel, etc.) That's also an aspect of the free market, the consumer has a choice.


If I quit drinking Coke, or don't shop at Walmart, there are alternatives. There are no reasonable alternatives to boycotting the buying of gas.

Every so often, someone passes around that internet email calling for a gas-out day. They want everyone in the country to not buy gas for one day. It's a stupid idea. The oil companies know that the next day, we are all going to be back at the pumps. We have no real choice.
Print the post Back To Top
No. of Recommendations: 0
But high priced gas would make the massive investments needed to come up with acceptible alternatives far more palatable, would it not?

That's what so weird to me: this idea that "massive investments" are required. What we need is "massive removal" of the subsidies the old energy companies demand and get.

Remember when paper recycling started? Everybody bitched about it...all the free marketeers complained about "government involvement"...but the driver was a mix of public sentiment and landfill space problems. Today there are countless recycling companies making a profit. It's a classic win-win.

Sometimes to break a technology monopoly, especially one as large and entrenched as the one we have with oil, you have to invest up front in an alternative. Once the alternative can stand on its own two feet, let it compete.

All we want is a level playing field. Cut out the subsidies to oil and gas, coal and nuclear. Invest in technology to help with energy storage and transmission. The rest will take care of itself.
Print the post Back To Top
No. of Recommendations: 0
Alternatives need to be developed for many reasons, not least of which are to break the stranglehold the oil companies have on our political process.


well get on out there and crack the whip. From what I have been reading on alternative sources of energy, lots of ideas, but none have proven itself to be viable...

which given todays willingness of the technology world to adapt new ideas, implies to me, they apparently need your help to "overcome the hurdles they appear to have" that you don't see.
Print the post Back To Top
No. of Recommendations: 1
All we want is a level playing field. Cut out the subsidies to oil and gas, coal and nuclear. Invest in technology to help with energy storage and transmission. The rest will take care of itself.

Or, option B, give the alternatives the same subsidies. I think we all know which way the "good" folks in Washington would go (or rather be "persuaded" to go).

I'm no fan of subsidies, but I'm also not a politician with constituents to buy votes from, er, I mean keep happy.

And, since you mentioned nuclear power, I wouldn't mind seeing more nuclear power plants personally. I live pretty close to Fermi II in southeast Michigan, so it isn't even a NIMBY proposition for me. High efficiency, no emissions, waste pellets smaller than a bottle of white-out and the largest reserves of fuel on the planet are domestic. I'm definitely a fan of nuclear power.

Mike
Print the post Back To Top
No. of Recommendations: 0
From what I have been reading on alternative sources of energy, lots of ideas, but none have proven itself to be viable...

You must be reading National Geographic, 1982 edition.

Wind power is on par with natural gas and closing in on coal. Too bad we continue to subsidize all those old energy industries, good old market capitalism at work...sheesh. I wish you were at least consistent.

For the amount we've spent in Iraq, we could have increased our electrical capacity by 50% just using wind alone. I know which one would have been the better value, which one would have led to our greater long term security.
Print the post Back To Top
No. of Recommendations: 0
Wind power is on par with natural gas and closing in on coal

can you expound on what you mean "on par"??


Print the post Back To Top
No. of Recommendations: 0
I chuckle everytime one particular poster pontificates about evil capitalists in between musings about his/her world travels.

I chuckle every time one particular poster makes stupidly simplistic statements mischaracterizing other posters, with their moronically black and white view of things.


I also chuckle when one particular poster makes a statement and, when they're politely asked to explain why they think that, completely ignore the question, possibly because they don't know what the **** they're talking about.
Print the post Back To Top
No. of Recommendations: 2
Exxon Mobil, Chevron, and ConnocoPhillips, combined to make 63 billion in profit, that's PROFIT, the money that is left over after they have paid all their bills, in 2005.

Someone want to explain to me again how gas is now at 2.29 a gallon because of the increased COSTS, that the oil companies have.


When gasoline is $1/gallon and the oil industry makes 10%, they earned $30B.

Now that gasoline is $2/gallon, the oil industry still makes 10%, so they earn $60B.

Are you suggesting that a law be created that forces profit margins to be reduced as prices rise?
Print the post Back To Top
No. of Recommendations: 1
I also chuckle when one particular poster makes a statement and, when they're politely asked to explain why they think that, completely ignore the question, possibly because they don't know what the **** they're talking about.

Expect more of the same Steve. Being ignored is the only interaction you deserve.
Print the post Back To Top
No. of Recommendations: 0
Expect more of the same Steve. Being ignored is the only interaction you deserve.


Making ignorant statements is a lot easier when you don't have to back them up, isn't it?


Go wallow in your Randian ignorance for all I care.
Print the post Back To Top
No. of Recommendations: 2
Making ignorant statements is a lot easier when you don't have to back them up, isn't it?

I don't make "ignorant statements". I make statements about the opinions I hold based on my knowledge and beliefs, the same as everyone else on this forum. I have no interest in "backing them up" or explaining them to a troll. You have no interest in understanding the basis for my views or respecting a different view in a civil conversation. You can't even deal with being ignored without becoming combative. Why should anyone expect to have a worthwhile exchange with you?

Go wallow in your Randian ignorance for all I care.

I'm not a Randian. But, if you are being earnest in implying you will leave me alone..... that would be great. Frankly, Steve you are a bore. Go find somebody else to play your petty games with.

Print the post Back To Top
No. of Recommendations: 0
I make statements about the opinions I hold based on my knowledge and beliefs


Like I said, ignorant.






You can't even deal with being ignored without becoming combative


This is your idea of ignoring me?





I have no interest in "backing them up" or explaining them


I'm sure I understand why.






But, if you are being earnest in implying you will leave me alone..... that would be great. Frankly, Steve you are a bore. Go find somebody else to play your petty games with.


I thought you were going to ignore me?





Okay then, I'll ignore you now.


Print the post Back To Top