[Dr. Bogus Pachysandra]

“the oil companies make $.10 a gallon.”
I thought the oil companies were making 10% profit. That would be more like 35 cents.

[dalebert]

Ya but they are in business to make a profit just like your congressman.

[MNJohnnie]

http://answers.yahoo.com/question/index?qid=20070903072430AAVZcEA

Every source I have found says $.10 or so, nothing says 10%

[mnehring]

“the oil companies make $.10 a gallon.” I thought the oil companies were making 10% profit. That would be more like 35 cents.

Both are correct (other than the .35c profit per gallon). Oil companies do make .10c per gallon profit on downstream, wholesale gasoline, but that is not where all their total profits come from. They also have downstream wholesale petrochemicals, such as products used to make plastics and other chemicals. They also have international downstream sales. The latter accounts for most of the total profits from most oil companies.

To put it in layman's terms, that barrel of oil an oil company buys is sold here and internationally. It is sold for fuel and it is sold for plastics production. They make a greater profit off plastics production with less expenses (less regulation on production). They make .10c per gallon off downstream fuel but they make somewhere in the equivalent range of .25c per gallon selling that oil for other uses.

[TheBattman]

Fuel is not the only product or service the oil companies make a profit on, although it is the most visible.