Talk about “windfall profits.” That’s what the GOVERNMENT gets with their taxes on gasoline as it goes up. They did nothing to earn it!
Ever hear of Google?
google the words: breakdown of gas cost
First result of many:
http://auto.howstuffworks.com/fuel-efficiency/fuel-consumption/gas-price1.htm
sheese.
Oil companies make about 7 cents per gallon, the gas station owner makes about 8 cents a gallon, states charge sales tax (CA its about 8% a gallon), the feds charge an excise tax which is fixed (I think its about 42 cents a gallon), states charge an excise tax which is fixed (CA its about 18 cents per gallon).
Probably can find a chart somewhere on the internet.
High gas prices result from high oil prices, because oil is the primary input cost for gasoline. “Big Oil” doesn’t set the oil prices. The commodities markets do. “Big Oil” earns HUGE profits when oil prices go higher, because the market has increased the value of what they sell. States DO indeed add on taxes to the cost of gasoline as well. Some higher than others. The massive printing of ‘money’ by the Federal Reserve couldn’t be helping matters either.
Someone correct me if I am wrong, but I believe most of the taxes on gas are per gallon not the dollar amount.
There are probably more links... google it.
Perhaps he should look into the declining value of the dollar, thanks in large part to the idiotic policies of the Fed.
A lot of good information on here, and remember:
Government makes much more profit on gas than does ANY private company in the entire exploration, drilling, distribution, refinement, sales process. This includes “big oil” companies.
On the retail end the local gas station or 711 received its gasoline and diesel fuel about every 10 days on average.
Given that the price changed on a daily basisi during those 10 days it was evident that the retailers were changing the price of gas based on the reported oil speculators activity and not those EVIL oil companies.
Nothing has changed, especially the Economic Ignorance of gas purchasing public!
Thanks for the question. This is a good thread to bookmark IMO.
I just read a few days ago that for every gallon of gas, the oil companies make 7 cents and the government makes 43 cents per gallon. Disgusting, can you imagine having a business and the government making more profit off your blood sweat and tears than you do?
The taxers make the most profit and the taxee gets lubed.
This is truly disgusting.
Snip: Gas prices keep rising nationwide. But how much you actually pay is affected by your income and local economy. Mississippi residents spend a whopping 14.2% of their income on gas.
Whoever owns the actual oil is the winner. Without going into the weeds, the tax on fuel is mostly per gallon sold. The Southland Corporation (7-11) went into the fuel business claiming they could get by on a nickel per gallon margin on retail sales. They went broke, but not before killing the retail fuel business. The refinery makes a certain amount of money. There are transportation costs. I’ve never seen an oil contract, so I don’t know if the mineral rights holder is on a sliding scale or not. They may just get a set price per barrel. Get a bunch of neighbors together and start a cooperative. Then, hire an exploration team; buy mineral rights; hire a drilling team; build pipelines; build a refinery; build more pipelines; build a wholesale fuel distribution point; buy a fleet of transport trucks; build stations; fight with the government, property owners and environmentalists about everything, and there you have it.
One of the big problems is the EPA mandated boutique gasolines that kick in every spring. This is described in the media as “Summer Driving Season” which is a misnomer. It’s not that people drive more in the summer (or not much). It’s that due to EPA regulations, instead of a couple of types of gasoline there are now more like 100 depending on your region. This produces artificial shortages, due to the havoc it wreaks on the refineries and the pipelines.
What would be very interesting (I’ll ping thackney to this thread) would be a multi-year graph of the spread between crude and gasoline on a month to month basis. My bet is that this spread typically enlarges in the spring and summer months due to what I’m describing. This is almost NEVER mentioned in the MSM I guess cause they don’t want you to know.
You can’t fully analyze this over a period of just a few weeks. Gas prices go up and down. Oil prices go up and down. They don’t always do exactly what you might predict. You’ve got to look at it over a period of years. One of the reasons oil companies are making a lot of money right now is that during the 90’s, they took a bath, losing hundreds of billions of dollars, and a lot of them went out of business. The current high profit environment is the result of their competition going out of business, and it to some degree makes up for the bath they took in the 90’s. So yes, they are making a lot of money, and that is good. It means that in the long run, they can stay in business, and we can continue to have gasoline.