Posted on 04/26/2006 6:35:00 PM PDT by Blood of Tyrants
Okay, I have seen a LOT of threads claiming that oil companies aren't really making that much on each gallon of gasoline.
Oh, really? (blink, blink) Then explain the record profits by the oil companies.
Why sure. First, US oil companies don't import all of their oil. In fact several companies actually import very little. Where do they get it? Why, from wells on private and federal land that they drilled on years and years ago. What is the extraction cost to get it out of these wells? You can be darned sure that it is nowhere near $75 a barrel. In fact, I read that it is somewhere around $7 to $15 a barrel. Add to this cost a small royalty that they pay the federal government or private land owner and refining and transportation cost and you come up with maybe $25 a barrel.
Now, mix in the oil they bought 3 or 4 months ago at $52 a barrel that is just now coming to the refinery and you have an average of between $25 and $40 a barrel.
So what we have is huge profits at the expense of the consumer. How long will it last? The prices will start to drop once they feel they are starting to harm the economy. Congress and the media and the consumers stop bothering them and they look for the next opportunity to do it all over again.
I stand by my statement.
It's not supply and demand that have taken oil prices this high. Prices have risen much faster and higher than demand has. Also production has been increased.
If Thomas Sowell can be an economist, so can I.
I'll take simple math over doubletalk any day.
It ain't really supply and demand, more like "Need and Greed!
A perfect example of someone who has no clue of what he is talking about. The oil companies are making more $$ because they are two companies. They are comprised of, e.g., Exxon who made XX billions and Mobile who made xx billions. The profits are greater but the number of gallons sold is greater. No matter what, they make a profit of $0.083 / gallon sold.
The government made 10 times that much in taxes not including state taxes and sales tax.
Actually, Knowledge and Decisions may be the most formative book I ever read. In a sense, it changed my life. But, it is a very dense book and requires an effort on the part of the reader to digest. Every sentence in the book is packed with meaning. I have given away a couple dozen copies over the years, but only when I think someone will make the effort to actually read the book with the focus it requires.
If you are accusing Tom Sowell of doubletalk or using complicated math, then you REALLY don't know what you are talking about.
The situation is really simple, and very easy to understand. I understand you don't like it; who does?
But, just because a situation exists that is not to your liking doesn't mean that there is a conspiracy affot.
As am I.
Which brings to mind a question:
What happened to the "Oil Shortage"?
You know...all the brouhaha about how we were running out of oil?
Do you suppose that the dirty little secret of the oil companies is that crude oil is a renewable resource? Carbon, pressure and time create diamonds and the world doesn't seem to run out of those.
Organic matter, pressure and time creates oil. Do you suppose that the vast scientific research resources available to these oil companies has discovered something that they'd just rather not have everyone know? It would destroy their margins.
Just speculatin'.
That ranks as one of the most ignorant statements I've seen all day.
If we got rid of all onerous government regulations and tariffs, then oil production would increase, refining capacity would increase, and gasoline prices would be lower than they are today with all the onerous government regulations and tariffs. Federal and state regulators make sure that crude oil cost savings are passed on to consumers. There's no way for refiners to pocket all the extra profit. It doesn't happen immediately, but pump prices fall when crude oil prices fall.
But the more we conserve, the higher goes the price.
This is far from economic cause and effect.
Can't prove it, but those who think this situation is okay, I will bet are those who can afford to pi$$ their money away or are in some way reaping this windfall along with oil companies.
I'd suggest since this is 'American' oil, and tons and tons of it is freely given to the oil companies
Actually, we seem to be saying the same thing.
That it has nothing to do with supply and demand, and everything to do with charging whatever the market will bear.
True?
Why do I still see people driving 80 miles an hour on the freeway?
They could shave 15% or more off of their gas bill doing 65. I guess it is more fun to bitch and moan about the gas price.
Happy 1st Day Anniversary.
But the more we conserve, the higher goes the price.
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