.

 

For a moment, lets say your right. Lets say the Oil Companies are, in deed, taking a greater percentage of profit.

Hypothetically, of course, so what? As long as they are not price gouging in a crisis, and there is no Katrina crisis right now, ALL US companies have the right to make money.

Would you be complaining if Minute Maid made profit from OJ during a bad Winter?

The fact that you need gas to get around ... More Profit.
Should we federalize and regulate the gas companies ala Ma Bell used to be?

 

Chows4us,

What is an unacceptable level of profit? How do you know it when you see it?

As for me, I am far less interested in regulating prices than I am in enforcing competition. There would be an antitrust law renaissance in a Whovous Administration.

 

We agree the oil companies do not control barrel prices, so I've cut that part from the discussion.

You've lost me here. First, I've never seen an oil exec say he'd love to build a refinery, if only prices could be kept more stable. In fact, I've never seen an oil exec make excuses for failure to build refineries at all. This seems to be a peculiarly American problem in the industrialized world. Why?
Second, refineries are traditionally profitable areas of operation.
Third, and most important, what refineries do, and how refineries make money, has little or nothing to do with the cost of a barrel of oil. Refineries make their profits from the value that they add to oil, not from the barrel price.

I have no idea what you are talking about here. Did I mention boycotts? I asked why I should buy oil stock, not how to make a boycott work. I have a MINI to drive, and it is hard to do that and to boycott at the same time.

PS. What does your user name mean? It bugs me when I can't figure one out, though it usually bugs me even more when it is explained and I realize what I missed.

 

I think one important thing people are forgetting about fuel prices is that relative to the cost of other things, gas is not that expensive. In the sixties and seventies, average salaries were $4000 to $10000 a year and gas cost less than $.65 per gallon. Now people make ten times that much, but gas isn't $6.50 a gallon, it's barely $3.50. And on the Oil Companies...I totally fail to understand why everyone is upset about extra profits. Think of it this way... most of us have a retirement plans, those plans invest in mutual funds and various companies, including oil companies, and the funds themselves invest in oil companies. So, profit from oil companies helps our investments. For those of us who invest directly (millions of Americans do, btw) this is a good thing. Also, oil company profits are taxable, so more profit means more tax for good ole Uncle Sam. After that, the profits go to shareholders in the form of dividends, and into research into new and better ways to produce energy.

Not sure of this helps, but one more thing... driving a MINI is an excellent way to help conserve, as Coopers get great mileage, and of course, are a blast to drive!
Mike

 

Sorry, I've listened too much to my energy macroeconomics professor as to why there is so little money spent in searching for oil. The explanation above gives the reason for why so little exploration has been done and why so little money is spent on shale oil projects and oil from coal projects.

Regarding the refineries, I don't really have an answer. I don't know, but it was never a problem until now. The only reason I can think of is lack of foresight or lack of capital. Maybe they didn't have excess capital to be spending on refineries when it didn't meet the cost of their capital. Then, there's just them lacking foresight. Maybe Saudi Arabia is the only place that has any foresight or maybe the oil execs saw Saudi Arabia making refineries and decided that if they also made refineries there would be a glut of refineries. However, let's stick to the lack of foresight. I mean, I know it sounds silly, but it happens all the time. Take for example the shipping industry. The shipping industry is hugely cyclical because shipowners have no foresight. When supply is tight and hiring rates for ships rise, everybody rushes to build ships, then when all the ships are completed, hiring rates drop because there is an excess supply and then slowly demand crawls up to meet supply and the cycle begins all over again. These are people that have billions and billions of dollars and idiotically let their children date people like Paris Hilton. It just happens. They've been doing it for decades but they don't learn.

My point is that is your choice. It's the great thing of capitalism. If enough people were like you and believed that oil companies weren't ethical, their stock prices would drop, their few shareholders would get angry and change policy/management to fit what would make people happy, thus demonstrating the greatness of a capitalistic economy.

It's a combination of Otaku and Couple, Otaku being a person that watches lots of Japanese animation and Couple meaning... I don't think you need an explanation for MINI... See, you don't have to feel bad. I don't think anybody would know that unless they were really hardcore anime freaks.

 

$42.09 at the cheapest shell in the area tonight. Boo...

 

It seems like there are a lot of people with strong opinions on this subject, from college student spouting dogma from their textbooks to people who are truly informed on the subject. We're also not allowed to talk politics here, so we're missing a large part of the discussion. What you learn in your economics class is the way things ought to work. What happens in the real world is not the same thing. There are countless forces at work here from what's going on in the middle east to our outdated refining capabilities to corporate malfeasance. To try to blame any one thing is not seeing the larger picture of the way our world works. The sad fact of the matter is that we're just going to have to pay more for gas. End of Story.

 

Wow, I find that quite offensive. It's funny how I show people your post to show how I realized that I actually did learn something in college despite my former opinion that college had taught me nothing. I'm done with this thread and your rudeness. I thought we were having a civilized debate. I guess I was wrong.

 

91 in downtow Sf, 3.55/gal

 

$2.66/gal, 93 Oct, AAFES service stations in Korea.

 

Oh don't be so sensitive. I was talking about all of us that have been debating this issue to death with facts garnered from the far reaches of the universe. I was just trying to say that there is more going on than what we may have been taught. When I first got out of college I was filled with all kinds of crap and ideology and it took me a long time to figure out that the world doesn't work the way they tell you in the textbooks and in class. While I sometimes feel I wasted (a lot of) money on college I don't ever regret it and neither should you. Sorry if you took the last statement personally, it wasn't meant that way.

 

Perhaps I shouldn't have, but I think this made it pretty insulting.

All is forgiven.

I just think that the American public has a tendency to always look for a scapegoat even when there is none. There are alot of intricacies in the world that people don't realize about energy, and I did benefit from a few of the classes from a college that is basically the recruiting ground for all things energy.

 

Hey guys think about it this way... gas prices going up = (hopefully) less SUVs and minivans on the road to cut us off because we're invisible to them


Gallon of 93 $3.34 last time I checked

 

$3.09 for Shell 93 in Austin. $3.00 for Chevron 93 in Austin.

 

No time for the hard issues right now, but are you going to Otakon?

 

Oil profits should be caped and regulated by Goverment. Yes I am a socialist!!

Link to CNN interview of oil wig defending there position:

http://www.cnn.com/video/player/play...il.defense.cnn

 

And the 'government' should be regulating the pricing of houses too! I am in need of a house to buy and the market is out of control. Home owners are raping us non homeowners with median prices in Orange County, CA being over $500,000. Are you one of those that are taking advantagous of the market or are you willing to sell me your home without maximizing your profit and selling it for many times what you paid for it few years ago?

 

... then tax the bejeezus out of them, and pour those full coffers of $$$$ into..... making all roads like those in Appalachia (Tail of the Dragon, Blue Ridge Parkway, any good road in West Virginia, etc.).

 

As much as I Bit@h and Complain about the high gas prices and drive all the way across town to save less than $0.05 on the gallon, I'm glad I don't drive an SUV right now.

Can you even imagine how empty their pockets are right now?

BTW, I need to get gas. The clock says I have 28 miles left (on average). Does anyone in old town alexandria know where cheap gas is? Well, within 28 miles.

Oh, I'm sooooo glad I picked up a Motorcycle this spring.

 

Uh, usually profit caps, are incentive caps also...

Thus capping incentives for drilling billion dollar dry holes 6,000 feet in the ocean and then 20,000+ feet into the earth would be included.

Thus capping incentives for the cost of exploration materials, rigs, equipement, engineers, and consultant expertise that has trippled in the last year.

Thus capping incentives for operating in hostile political environments where the governments may take over billions of dollars in exploration and facilities overnight with their military.

Or just move your oil company 'financially off-shore' and forget about any profit caps, or taxes.

Also do not forget about the 1.6 billion Chineses that want to drive cars, they want oil. Also they are starting their own SPR (Strategic Petroleum Reserve). Do not forget the 1 billion Indians who want energy resources too.


Interference with free-market economies often results in shortages of products. Who wants shortages of gas/oil?

Also Oil companies are selling the oil to Refiners who sell it to Distributers who sell it to Resellers. Have you ever bought gas at Shell station and noticed a tanker from someone else unloading (Brenner Oil, Murphy Oil, Marathon, etc.), and wondered why? So who really is profiteering?


Just some thoughts as I read through reports from the DOE, CERA, IEA, Oil and Gas news, Rigzone.com, Kuwaititimes, AlJazeera.net...and other misc energy related news.

 

How about that free market? There is only 5 "LARGE" oil companies (I think in the world not sure). There were 14-15 in the 70's. I think the price would be cheaper if there were more companies.

There is a lot more to oil than just price. Will be interesting to see what happens when China and India to come online FULL force with there economies.

 

Just got back. 12.4 gallons

$41.50

There goes Happy Hour

 

Not that hardcore, just hardcore enough that I don't watch regular TV anymore and just hook up my laptop to watch new anime series from Japan. I don't cosplay or anything...

 

I don't think I ever said there was an unacceptable level of profit.

America is based on free enterprise ... what the market will bear. Just take a look at Gold prices. It was once "regulated" for Americans at $28 then $33/oz until the US figured it we live in a global economy and now our money is just based on good faith ... scary huh?

I actually read today that the BEST way to get prices down is not boycotts or other crap that dont mean nothing to the companies because sooner or later you WILL buy gas.

Rather, it IS competition, just like you said. The gas station owners need to have an old fashioned price war although their profit margins are low. So too must Exxon, Shell, Chevron, etc. If everyone went to Shell (a Dutch company) than Exxon, do you think Exxon will lower its wholesale prices?