It's hard out here for a pump

[DesertFox]

Ann Coulter
Human Events Online
26 Apr 06


I would be more interested in what the Democrats had to say about high gas prices if these were not the same people who refused to let us drill for oil in Alaska, imposed massive restrictions on building new refineries, and who shut down the development of nuclear power in this country decades ago.

But it's too much having to watch Democrats wail about the awful calamity to poor working families of having to pay high gas prices.

Imposing punitive taxation on gasoline to force people to ride bicycles has been one of the left's main policy goals for years.

More (http://www.humaneventsonline.com/article.php?id=14359&o=ANN001)

[dPrasse]

3.00 gas is not high enough for the Libs ...

[Gonzo67]

People need to start looking at the oil companies themselves. I mean it doesn't take a f**king genius...

The oil companies claim the prices are not jacked up... and yet in the very next breath they announce record profits for the second time straight. Hmmm I wonder how THAT happened? And then they proudly parade one of their exiting puppets in front of the media and flaunt it to the American public that this butt licker is leaving with a retirement package worth over $300 million. But no, their prices aren't jacked up in the least.

Is it really that hard to figure out where the record profits and multi-million dollar retirement packages are coming from?
:question:

[Riverboat]

I'll read the rest of her column, of course, but I don't really need to. Of COURSE she's right. Advice from Democrats on gas prices, after reading about a proposed gas tax hike in California? I'd rather get advice on donating my organs from Jeffrey Dahmer.

[Gonzo67]

I'd rather get advice on donating my organs from Jeffrey Dahmer.


You would only get recipes.

[DeclinetoState]

Seeing the title, I thought the article was about Bill Clinton . . .

[Gonzo67]

ROFL No... would more likely be about Monica.
:whistle:

[Native American]

People need to start looking at the oil companies themselves. I mean it doesn't take a f**king genius...

No, we need to start looking at the Democrat Party, and its stated policies over the decades.

The Democrat Party has opposed oil extraction from Alaska.

The Democrat Party has supported raising gasoline taxes.

The Democrat Party has opposed construction of new refineries.

The Democrat Party has supported forcing refineries to make special blends.

The Democrat Party has opposed construction of new nuclear power plants, thereby driving up the burning of precious oil for electricity.

The Democrat Party has opposed construction of new coal-fired power plants, thereby driving up the burning of precious oil for electricity.

It's the Democrat Party, not the oil companies, which has created the mess we now find ourselves in.

Over 40 years of stated Democrat Party policy has brought us to where we find ourselves today. And it's high time we as a nation begin examining whether those stated Democrat Party policies have been a success, or a gross failure. Remember - the Democrat Party ruled Congress for almost all of that time. It is high time to begin holding the Democrat Party responsible for what it has done to our country.

[DesertFox]

As Ann indicates, the oil companies get 9 cents per gallon. ALL the rest is taxes. There are record profits because Americans are buying gas in record amounts. THAT's happening because the Bush economy is so robust that people can afford the gas even WITH all the taxes thrown in.

No, it doesn't take a genius. It does, however, take some common sense to recognize what's there.

[Riverboat]

According to my math, that comes pritnear $2.90 a gallon. That'll buy a lot of looking the other way in Washington and fifty state capitals.

[DoctorDoom]

This is SOP for the RATs. Their obstructionist, anti-business policies create major problems, and then they have the brass balls to blame the problems on the prez and the GOP. The concept of shame is unknown to them.

The US presently uses about 400 million gallons (http://www.conocophillips.com/newsroom/other_resources/energyanswers/gasoline.htm) of gasoline per day. Assuming $3/gallon, the cost of the gas is $1.2 billion/day. As Ann and our Freecer oil experts have pointed out, oil companies make about 8-9 cents of profit on a gallon of gasoline. Thus the daily profit for all of the companies combined, using the 9¢ figure, is about $36 million.

The federal tax on gasoline is 18.4¢/gallon. Ergo the fedgov's daily "profit" on the 400m gallons is $73,600,000. I hear no liberals and Big-Oil-bashers pissing and moaning about that.

The US average state tax on gasoline is 28¢/gallon. Thus the states reap a daily "profit" of $112,000,000. I hear no liberals and Big-Oil-bashers pissing and moaning about that.

The oil companies' profit is $36M/day. The fed and state govs' "profit" is $185.6M/day. And who feels the wrath of the clueless sheeple? Big Oil, of course, because they're too farking ignorant and brainwashed to direct their ire at the real recipients of "windfall profits".

Again assuming $1.2B/day total gasoline costs, and subtracting taxes and profits ($221.6M), the result is $978.4M/day. Where does THAT go? A: crude oil and other materials required for processing; operating costs of the refineries; transportation costs; maintenance and construction costs; payroll, pensions and benefits; insurance premiums; federal, state and local taxes; business expenses; investor returns; advertizing; legal departments to deal with assholes; etcetera, etcetera.

Big Oil is a favorite target for the leftist, anti-business, anti-America RATs who have created most of the problems that they are now bemoaning so verbosely and obstreperously.

As for the ongoing attacks on the $400M pension of the Exxon/Mobil exec, the RATs and their DBM partners in crime never mention that if the entire $400M were applied to reducing the price of gasoline, it would lower it by $1/gallon for one day, and then it would be back up again. Nor do they mention that the $400M is in large part stocks, not a really fugging big check. But, class envy is another of the RAT bastards' favorite tools for creating dissension and hatred.

[Rhino]

Big Oil is a favorite target for the leftist, anti-business, anti-America RATs .........Big anything is a favorite target for them. The bigger they are, the less the public understands how they work, and thus become prime targets for lies, innuendo and manipulation on the part of anyone with a political agenda and no scruples.

[Lazarus]

People need to start looking at the oil companies themselves. I mean it doesn't take a f**king genius...

The oil companies claim the prices are not jacked up... and yet in the very next breath they announce record profits for the second time straight. Hmmm I wonder how THAT happened? And then they proudly parade one of their exiting puppets in front of the media and flaunt it to the American public that this butt licker is leaving with a retirement package worth over $300 million. But no, their prices aren't jacked up in the least.

Is it really that hard to figure out where the record profits and multi-million dollar retirement packages are coming from?
:question:First of all, welcome to the truth zone, Gonzo... We always enjoy polite debate from opposing views...

Now Im going to try to explain how the economic numbers work...

We have high gas prices because we do not have the refinery capacity to handle the ever increasing demand for REFINED fuel... Due to the efforts of the most vocal Enviro-nazis in this country, the EPA has become a government department out of control... Its Eco-dominated regulations have completely stopped the oil companies from building new refineries over the last 30 years - And I dont even want to address the nuclear power debacle...

In that time not only has American gasoline consumption increased dramatically, but world-wide demand has also exploded... This is mainly due to increased population as well as a sudden increase in disposable household income in what was the lowest income levels... China alone has injected millions of new drivers into the world fuel market in the last 10 years...

Also, due to the EPA, every major metropolitan area in America has its own special fuel mixture that it demands to be sold in its city limits... Since any single refinery can only produce one specific blend on any given day, all other fuel blends must wait in line for the next available day...

IOW, when the almighty city of Los Angeles is getting their fuel blended at the refinery, that refinery is unable to make the common blend that Podunk Hollar needs to fill their pumps... So all the Podunk Hollars of the world must wait for their turn... This alone creates a huge shortfall in fuel supllies for the nation on the whole...

Now we apply the simplest law of Economics - Supply and Demand... More specifically, when Supply is high and demand is low or static, price drops... Or the reverse, which is our case, when Supply is low or static, and Demand increases, Price rises...

Crude oil supply is not the problem and crude oil prices contribute very little to this particular price equation... We have a REFINERY SHORTAGE... And it can be laid directly at the feet of Enviro-nazis... No, I take that back - It can be laid directly at a gullible, uneducated voting public who let themselves be led by the nose by the Enviro-nazis...

This accounts for the high prices at the pump... Now as to Oil Company profits...

When you are a company that sells a product, and there is a static supply of that product - you simply cannot increase your production capacity because of artificial obstacles created by government - and you face a steady increase in public demand for your product, Free market forces automatically kick in and the price per unit rises - ie, the person able to pay the highest price, gets the product...

All this time it doesnt cost you, the supplier, any more to produce the product... Thus the Supplier's overall profit rises, in a time when he is unable to increase production due to GOVERNMENT HINDERANCE of the free market...

In a natural free market situation, once the price increases, production increases to answer the higher demand, and new producers enter the market in order to claim a stake of the profit pie...

But in our case, the free market forces are barracaded by the EPA... Oil companies are unable to build new refieries because of EPA obstacles... The oil companies will continue to take in big profits simply because politicians have inserted their power into the economic mix for their own politcal purposes...

Bottom line: The bill has come due for 30 years of EPA hinderance into the petroleum market... America bought into the Enviro lies, and now we have to pay the bill...

Regardless of what lies the politicians promise in the way of quick fixes, there are no quick fixes for this problem... You cant correct a wrong course you have been steering for the last 30 years in an overnight decision...

Enjoy your meal...

[DesertFox]

I don't think the 9 cents per gallon that the oil companies get is profit. I think it's what they get back on a sale. FROM that would be subtracted all their costs.

[Rhino]

What's wrong with profit?

[Borgia]

We have high gas prices because we do not have the refinery capacity to handle the ever increasing demand for REFINED fuel... Due to the efforts of the most vocal Enviro-nazis in this country,.....

Here is the problem with your logic, Lazarus. If we look at gasoline costs over the last 6 years we see a low of about $1.25/gallon up to a high of about $3.13/gallon.

You claim the high price of gas is due to environmentalists. If so, what new rules/regulations have been enacted since 2000 that have so greatly effected the price of gas?

I am not saying environmental costs do not contribute, but I think the relatively recent rise in gasoline prices probably has a lot more to do with the price of oil than anything else. But if you can show me all the environmental regulations and their costs that have been enacted under Bush that have caused the price to rise, be my guest. I humbly await your evidence.

[bannerman]

http://i3.tinypic.com/wkid5u.png

down down DOWN with BIG PIZZA

[bannerman]

What's wrong with profit?

<br />
<div align="center"><img src="http://i3.tinypic.com/wkijwn.jpg" /></div>

[Native American]

The federal tax on gasoline is 18.4¢/gallon. Ergo the fedgov's daily "profit" on the 400m gallons is $73,600,000. I hear no liberals and Big-Oil-bashers pissing and moaning about that.

The US average state tax on gasoline is 28¢/gallon. Thus the states reap a daily "profit" of $112,000,000. I hear no liberals and Big-Oil-bashers pissing and moaning about that.

The oil companies' profit is $36M/day. The fed and state govs' "profit" is $185.6M/day. And who feels the wrath of the clueless sheeple? Big Oil, of course, because they're too farking ignorant and brainwashed to direct their ire at the real recipients of "windfall profits".

The taxes per gallon are just the beginning! In addition, the government slaps a tax on the profit that the oil companies make.

The government also slaps a tax on the income that everyone who works for the oil companies earns.

And the socialist clown Democrats have the gall to speak of "gouging"???

[Native American]

Originally Posted by DoctorDoom
Big Oil is a favorite target for the leftist, anti-business, anti-America RATs .........


Big anything is a favorite target for them. The bigger they are, the less the public understands how they work, and thus become prime targets for lies, innuendo and manipulation on the part of anyone with a political agenda and no scruples.

Not quite, Rhino. Big government is never the target of the anti-business, anti-America Democrats!

[DoctorDoom]

Yep, there is THAT exception.

[Rhino]

Not quite, Rhino. Big government is never the target of the anti-business, anti-America Democrats!Touche! I shoulda thought of that.

[Naturalized-Texan]

People need to start looking at the oil companies themselves. I mean it doesn't take a f**king genius...

The oil companies claim the prices are not jacked up... and yet in the very next breath they announce record profits for the second time straight. Hmmm I wonder how THAT happened? And then they proudly parade one of their exiting puppets in front of the media and flaunt it to the American public that this butt licker is leaving with a retirement package worth over $300 million. But no, their prices aren't jacked up in the least.

Is it really that hard to figure out where the record profits and multi-million dollar retirement packages are coming from?
:question:
Exxon just announced their 1st Quarter earnings: Revenue: $88.98 Billion; Net Income: $8.4 Billion; Profit Margin: 9.4%. Nothing obscene there. That's about the average profit margin for a successful American corporation.

Compare that with McDonald's profit margin of 11.6%. Let's investigate McDonald's for price gouging. It's clear that McDonald's profits are obscene. :evilgrin:

What about Disney? Its profit margin is 15%. Let's investigate Disney for price gouging. It's clear that Disney's profits are really obscene. :evilgrin:

[Lazarus]

Here is the problem with your logic, Lazarus. If we look at gasoline costs over the last 6 years we see a low of about $1.25/gallon up to a high of about $3.13/gallon.

You claim the high price of gas is due to environmentalists. If so, what new rules/regulations have been enacted since 2000 that have so greatly effected the price of gas?

I am not saying environmental costs do not contribute, but I think the relatively recent rise in gasoline prices probably has a lot more to do with the price of oil than anything else. But if you can show me all the environmental regulations and their costs that have been enacted under Bush that have caused the price to rise, be my guest. I humbly await your evidence.Well you're right on cue as usual Borgia... You entirely missed everything I posted - Go back and read again, with this hint in mind this time...

I never said it was Environmental costs - you never once saw anything in my post that associated the two words "environmental" and "cost" together... What I did say was that environmental REGULATIONS have prevented the oil companies from building new refineries to keep up with the growing demand for gasoline from an ever growing world population that is buying and operating more cars than ever before...

No new refineries have been built in 30 years because EPA regulations have made it cost-ineffective for the oil companies to engage in new construction... There lies the rub...

Again I will state that Static Supply + Increasing Demand = Rising Prices... Its basic economics, Borgia...

Add to this the fact some of those very limited and precious refineries were severely damaged during the hurricanes last year, and you get an even tighter gasoline supply...

Crude prices certainly are a contributor to the price, as are taxes and other costs, but this is a minor influence in the face of the economic bottleneck I listed above... The increase in crude oil prices simply do not account for the massive price jumps we have seen in the last three years...

But since you are convinced that Crude Oil prices are the great perpetrator in this crime (albeit an uninformed opinion), then Im sure you'll be the first to lead the movement to open ANWR to oil exploration and production... Can we count on your support in this effort to free America from the grip of OPEC?

[Lazarus]

Exxon just announced their 1st Quarter earnings: Revenue: $88.98 Billion; Net Income: $8.4 Billion; Profit Margin: 9.4%. Nothing obscene there. That's about the average profit margin for a successful American corporation.

Compare that with McDonald's profit margin of 11.6%. Let's investigate McDonald's for price gouging. It's clear that McDonald's profits are obscene. :evilgrin:

What about Disney? Its profit margin is 15%. Let's investigate Disney for price gouging. It's clear that Disney's profits are really obscene. :evilgrin:Excellent, Tex...

BTW, nice Avatar... Just seeing Ronaldus Magnus lifts my spirits...

[Native American]

Exxon just announced their 1st Quarter earnings: Revenue: $88.98 Billion; Net Income: $8.4 Billion; Profit Margin: 9.4%. Nothing obscene there. That's about the average profit margin for a successful American corporation.

Compare that with McDonald's profit margin of 11.6%. Let's investigate McDonald's for price gouging. It's clear that McDonald's profits are obscene. :evilgrin:

What about Disney? Its profit margin is 15%. Let's investigate Disney for price gouging. It's clear that Disney's profits are really obscene. :evilgrin:

You don't even want to think about the profit margin on some of the hit films that Hollywood cranks out! Some of those profit margins are, literally, in the hundreds of percent. And of course the Democrats in Congress would never even in their wildest moments consider investigating the "price gouging" by those film studios.

[Borgia]

I never said it was Environmental costs - you never once saw anything in my post that associated the two words "environmental" and "cost" together... What I did say was that environmental REGULATIONS have prevented the oil companies from building new refineries to keep up with the growing demand for gasoline from an ever growing world population that is buying and operating more cars than ever before...

Oh, so your claim is the rise in cost is due to the lack of oil refineries? All right. What changed over the last 6 years to cause such a large demand in gasoline prices? Has demand almost doubled in that time so that the price has doubled?


But since you are convinced that Crude Oil prices are the great perpetrator in this crime (albeit an uninformed opinion), then Im sure you'll be the first to lead the movement to open ANWR to oil exploration and production... Can we count on your support in this effort to free America from the grip of OPEC?

I am all for opening up ANWR as I have made plain on other threads.

[Lazarus]

Oh, so your claim is the rise in cost is due to the lack of oil refineries? All right. What changed over the last 6 years to cause such a large demand in gasoline prices? Has demand almost doubled in that time so that the price has doubled?Ahem.... Have you not noticed the significant increase in cars on the road in the last 10 years? I certainly have... With the "creative" financing options that car dealers are offering the public now, along with increased incomes in the lower income classes, FAR more people are driving cars now than ever before - I will bet you that half the new cars on the road today are leased vehicles...

I've seen our local metropolitan interstates go from moderate traffic to creeping rivers of cars thast move at the blinding speed of a glacier... Everyone I know has commented on the sudden increase in the numbers of cars on the roads today - many of those are due to this sudden influx of "visitors" from Latin America...

And as I have stated before, and as anyone has heard that has been listening to the news, China's population has suddenly experienced a significant increase in household incomes resulting in huge auto sales that were never in the world gasoline mix before - this injection of millions of new drivers has literally occurred over the last 4 years... These people are buying gasoline from the same pool that we compete for...

I am all for opening up ANWR as I have made plain on other threads.Then on that point we are in agreement... Write your Congressman and Senators...

[Rhino]

He supports more refineries too. The rising costs are due to two main reasons, increase in demand more than supply that has driven oil prices up and limited refining capacity. Katrina evidenced that quite well. The oil supply was hardly touched, but refining capacity was, and prices went up. There are also other less critical factors that affect prices, but these are the two major ones.

[Naturalized-Texan]

When gas prices increase the way they are now, uninformed politicians scream for releasing crude from the Strategic Petroleum Reserve. Unfortunately, that would be only a drop in the bucket compared to the demand and, even worse, thanks to the enviroNazis, we don't have the refining capacity to refine any significant increase in crude oil.

I haven't read every word in this thread, but I haven't seen anyone mention that refineries are now transitioning from the blending of MTBE into gasoline to the blending of ethanol into gasoline. That has resulted in a temporary reduction in the refining of gasoline with the accompanying increase in price.

I did notice that some have mentioned that some refineries damaged by Katrina and Rita are not up and running yet and several Gulf drilling rigs are not yet operational after hurricane damage.

The BP-Amoco refinery in Texas City that was shut down by a fatal explosion more than a year ago has just come back on line in the past week or so. That should help increase our refining capacity. (A couple of personal notes: 1) My wife was babysitting our grandkids in Texas City about 3 miles from that refinery when it exploded. As you might expect, it shook the house and scared them badly. 2) Our daughter-in-law's brother was working near the unit that exploded and heard the whooshing sounds that preceeded the explosion. He yelled "RUN" to everyone around him and they were able to run to safety. He sprained his ankle running away from the explosion.)

[UnkHiram]

People need to start looking at the oil companies themselves. I mean it doesn't take a f**king genius...

The oil companies claim the prices are not jacked up... and yet in the very next breath they announce record profits for the second time straight. Hmmm I wonder how THAT happened? And then they proudly parade one of their exiting puppets in front of the media and flaunt it to the American public that this butt licker is leaving with a retirement package worth over $300 million. But no, their prices aren't jacked up in the least.

Is it really that hard to figure out where the record profits and multi-million dollar retirement packages are coming from?
:question:

The oil companies make 9 cents off each gallon, the Govt makes 43 cents off every gallon. That's right lets attack a LEGITIMATE business trying to make a profit that will fuel the 401Ks of millions of Americans and ignore the real thief.

You want lower gas prices, drill in Alaska and the Gulf, lower the friggin taxes and stop blaming the oil companies for making a profit. I wont even bother to point out that NO new refineries have been built in the country in over 20 years, so more money goes to the friggin arabs. I wont bother to ask where were you and your bleeding heart when it was 15 dollars a barrell and the oil companies were LOSING money.

[Wyatt_Junker]

http://i3.tinypic.com/wkid5u.png

down down DOWN with BIG PIZZA


Great point. Food is cheap. Why's it so expensive to have some min. wager flip around some dough?

Let's not even talk about Evian water. It makes gas look like charity work.

[Telit laikitiz]

Isn't it the goal of libs and dems to spread the wealth around the world, and aren't they doing it by trying to trick us into believing in global warming, a state of fear if you will? I think this is all connected together: no new refineries, no new exploration, portray Americans as greedy pigs who ignore the poor commies and socialists, stop war by letting the Islamo-fascists take over, let immigrants bully and stomp on the constitution, etc, etc. The question is are we going to let them get away with all this? I think not.

[Native American]

Let's not even talk about Evian water. It makes gas look like charity work.

Another excellent point!

[Borgia]

Ahem.... Have you not noticed the significant increase in cars on the road in the last 10 years? I certainly have...

No, the price doubled in the last 6 years. You need to explain how demand has fueled that cost increase. Any stats on gas usage vs refining amount? No? Then you are just guessing.

Oh, here you go. http://tonto.eia.doe.gov/oog/info/twip/twiparch/040714/twipprint.html

A graph that shows demand and capacity. AS you can see, capacity is higher than demand and over the last 6 years, demand has been rather flat, at most a 10% increase but capacity handles that increase.

So, I brought the data which clearly refutes your thesis.

Also, here is an excerpt from the DOE:

U.S. refinery capacity has increased 1.9 million barrels per day over the last 10 years, which is equivalent to the addition of 1 medium-size refinery per year on average, as refiners attempt to de-bottleneck and make their refineries more efficient, change feedstocks, and add capacity to meet market opportunities.



And as I have stated before, and as anyone has heard that has been listening to the news, China's population has suddenly experienced a significant increase in household incomes resulting in huge auto sales that were never in the world gasoline mix before - this injection of millions of new drivers has literally occurred over the last 4 years... These people are buying gasoline from the same pool that we compete for...

Yes, this demand is driving the price of oil up. Exactly what I was saying. The price of oil is the main cause of gasoline price increases.

[Borgia]

Note, I am NOT saying refining capacity has nothing to do with prices. it certainly does.

But from a corporate point of view, if you have excess capacity lying around unused, you are losing money. Unsused capacity = lost revenues, that is standard business practice.

So I doubt oil comapnies will suddenly start building in much excess capacity since until a hurricane knocks a refinery out, the excess capacity translates to a loss for them. Far better to have enough capacity such that Capacity = 110% of demand. You need some margin of error and that is where the extra 10% comes from. For the business reasons, you won't see them go to 120% as that means money out the door.

[Jag Wife]

Our local news station, WBTV here in Charlotte, actually had the spine to report the breakdown for a gallon of gas as to where the money's going. I don't remember all the details, but here goes:

Out of a $2.92 (average) per gallon:

.09 is profit for the oil company
.27 is North Carolina gas tax
.47 is federal gas tax

I don't remember the rest of it, but it sure as heck is NOT going into Exxon/ Mobil's pockets.

[Rhino]

From the DOE link Borgia posted:

Meanwhile, demand has grown, shrinking remaining excess capacity. In 1994, capacity was 15.0 million barrels per day, its lowest point since the peak in 1981, and utilization had risen to 92.6 percent. Since then, demand growth has been met by both increases in domestic refining capacity and product imports. With consumption of petroleum products, especially for transportation fuels including gasoline, diesel and jet fuel, expected to grow 1.5 to 2.0 percent per year on average in the years ahead, supply to meet that increase will continue to come from expansion in U.S. refining capacity and increased product imports, although both of these sources confront economical hurdles.

With many years of low returns on investment until recently, U.S. refiners are still faced with uncertainty over whether they will earn adequate returns on capacity expansion investments. Further inhibiting a rapid expansion in supply, tightening U.S. specifications relative to much of the rest of the world implies higher prices may be required to attract increasing import volumes - at least for the next few years.I find a few interesting points here. Demand has indeed risen, but up until the time of this report (july 2004), expanded capacity had met the demand. However, demand was increasing closer to the total capacity, and that was expected to continue. This was all pre-Katrina too, so the effect of losing refineries when we were already running near capacity was not addressed.

If you look at the most recent report (http://tonto.eia.doe.gov/oog/info/twip/twip.asp), you'll see that gasoline inventories have dropped significantly in the last few weeks, as prices have risen. That seems to make sense. They also speak about the MBTE/ethanol issue as a possible cause of inventory loss.

It's an interesting site, but it points out what has mainly been the focus here. Gas prices are most effected by oil prices, but are also affected by refining at near capacity, so that there is no cushion available to handle disruptions or unexpected surges in demand. We need to address both.

That site also has the past reports available (http://tonto.eia.doe.gov/oog/info/twip/twiparch/twiparch.html) and I was looking at some of the reports immediately after Katrina. Refineries were the major cause of those price increases.

[Naturalized-Texan]

As Profits Soar, Oil Industry Unapologetic (http://biz.yahoo.com/ap/060428/earns_oil.html?.v=6)

Taken together, Exxon, Chevron and ConocoPhillips made a profit of $8.19 on every $100 in sales. In contrast, Internet bellwethers Google Inc., Yahoo Inc. and eBay Inc. collectively turned a $19.20 profit on every $100 of their combined revenue.

......................

Even as politicians snipe at the oil industry's profits, the government has been sharing in the windfall from high gas prices. In the first quarter, Exxon, Chevron and ConocoPhillips turned over a combined $13.8 billion in sales taxes -- about 7 percent of their total revenue.

{More at the link above.}

[DesertFox]

This has become a Hall of Fame post.

[sunsettommy]

People need to start looking at the oil companies themselves. I mean it doesn't take a f**king genius...

The oil companies claim the prices are not jacked up... and yet in the very next breath they announce record profits for the second time straight. Hmmm I wonder how THAT happened? And then they proudly parade one of their exiting puppets in front of the media and flaunt it to the American public that this butt licker is leaving with a retirement package worth over $300 million. But no, their prices aren't jacked up in the least.

Is it really that hard to figure out where the record profits and multi-million dollar retirement packages are coming from?
:question:

Try reading this link:

This is just an excerpt,

From FACTS ON FUEL

ARE OIL COMPANY PROFITS OUT OF LINE?
Oil and natural gas industry profits are right in line with the average for all industries. Because gasoline is so important to everyday life, some folks get nervous when prices go up and raise allegations of price gouging by oil companies. But, over the years, more than 30 government reports have confirmed that gasoline pricing is driven by legitimate market forces.
Earnings (Net income/Sales)
http://www.factsonfuel.org/images/graph1.gif
http://www.factsonfuel.org/images/graph2.gif

http://www.factsonfuel.org/gasoline/index.html#areoilcompanyprices

[sunsettommy]

From GIBSON Consulting,

Some interesting oil industry statistics

©1997-2006 Gibson Consulting
http://www.gravmag.com/seismogr.gif
<TABLE cellSpacing=5 cellPadding=5 border=1 COLSPEC="L12 L60"><TBODY><TR><TD bgColor=purple><CENTER>http://www.gravmag.com/oilpic.gif</CENTER></TD></TR></TBODY></TABLE>

http://www.gravmag.com/oil.html#imports

[Borgia]

Lazarus:

In reading the news today I came across this:

http://news.yahoo.com/s/usatoday/20060502/bs_usatoday/statesfindittoughtoprovegaspricesillegal

"Gasoline is made from crude oil, which accounts for roughly 55% of the pump price for gasoline, the U.S. government says."

So my contention that rising oil prices is the main cause of rising gas prices seems to be correct. Let's break it down for a $3 gallon of gas.

$1.65 is due to the price of oil (raw material)
$0.50 is due to govt taxes
$0.10 is due to profit

That leaves us $0.75 which is probably due to manufacturing cost.

Now, when we import oil, the downstream cost of refining it has NO effect on the price of oil. So the tightness in refining must be in the $0.75 somewhere.

But since $1.65 > $0.75 we can conclude that the price of oil has a far greater impact on the price of gasoline than refining capacity.

[Naturalized-Texan]

And the oil companies have absolutely no control over the price of oil.

[Borgia]

And the oil companies have absolutely no control over the price of oil.

I would amend that to very little control over the price of oil and then I would agree with you.

Anyway, my point was that our high gas cost is due mostly to the high cost of gasoline's raw material, oil.

Why has the price of oil gone up? Mainly due to increased demand for oil worldwide and a tightening of supplies. Refining is downstream of oil and has little effect on the price of gasoline.

[Naturalized-Texan]

I would amend that to very little control over the price of oil and then I would agree with you.
OPEC and the futures traders (speculators) have total control of the price of crude oil. The oil companies have no control.

Anyway, my point was that our high gas cost is due mostly to the high cost of gasoline's raw material, oil.
That and the increased world-wide demand for oil, as you point out below.

Why has the price of oil gone up? Mainly due to increased demand for oil worldwide and a tightening of supplies.
Correct. I know that you support drilling in ANWR and off the Gulf and Pacific coasts to increase the supply of oil and decrease our dependence on foreign oil. Long term, a major way to decrease our demand for oil is to replace all oil-powered electrical power plants with nuclear-powered electrical power plants.

Refining is downstream of oil and has little effect on the price of gasoline.
Not true. Our refining capacity, or lack thereof, is a major factor in the current price of gasoline. We haven't built a new refinery in nearly 30 years, thanks to the environmental wackos, and the expansion of our current refineries hasn't been able to keep up with the huge increase in demand. Also, most of the refineries that were shut down by Katrina and Rita are not yet operating and most of the Gulf drilling rigs destroyed by those hurricanes are not yet operational. The BP-Amoco refinery in Texas City that was shut down by the explosion over a year ago is just now coming online and won't be at full capacity until at least the end of this year.

Even if we open up drilling in ANWR and off the Gulf and Pacific coasts, without increased refining capacity, we won't be able to refine that oil. We need a huge increase in the number of refineries and the oil companies are eager to build them, but the environmental-wacko regulations won't let then do it.

[Borgia]

Correct. I know that you support drilling in ANWR and off the Gulf and Pacific coasts to increase the supply of oil and decrease our dependence on foreign oil. Long term, a major way to decrease our demand for oil is to replace all oil-powered electrical power plants with nuclear-powered electrical power plants.

I am a huge proponent of nuclear power. Of course it requires very strict safety controls.



Not true. Our refining capacity, or lack thereof, is a major factor in the current price of gasoline. We haven't built a new refinery in nearly 30 years, thanks to the environmental wackos, and the expansion of our current refineries hasn't been able to keep up with the huge increase in demand.

Refining capacity is higher than demand. We have not built a new refinery but upgrades have been the equiavalent of a new refinery per year.

My calculation shows that refining capacity AT MOST can contribute $0.75 per gallon while the price of oil contributes $1.65. Therefore, the evidence shows that fluctuations in the price of oil have a much larger impact than the refining capacity.

[Naturalized-Texan]

My calculation shows that refining capacity AT MOST can contribute $0.75 per gallon while the price of oil contributes $1.65. Therefore, the evidence shows that fluctuations in the price of oil have a much larger impact than the refining capacity.
Then why are all the energy experts that I have heard stating that a major reason for the high gasoline prices is a shortage of refining capacity due to the fact that so many refineries are still off line following last year's hurricanes and the mandatory switchover from MTBE to ethanol?

[sunsettommy]

I am a huge proponent of nuclear power. Of course it requires very strict safety controls.

I live right next to one and the safety controls are built right in the design.

Not many ways for it to go wrong and lose control of the facilities nuclear reactions.

Take a look at France and tell me how often they have a serious problem.A nation that gets 80% of their power Nuclear plants.


Refining capacity is higher than demand. We have not built a new refinery but upgrades have been the equiavalent of a new refinery per year.

Upgrades are more a desperate bandade way to try keeping up with the demand.

My calculation shows that refining capacity AT MOST can contribute $0.75 per gallon while the price of oil contributes $1.65. Therefore, the evidence shows that fluctuations in the price of oil have a much larger impact than the refining capacity.

Then tell us how they can build new MODERN refinery plants now.

[Borgia]

I live right next to one [nuclear power plant] and the safety controls are built right in the design. Not many ways for it to go wrong and lose control of the facilities nuclear reactions.

Hmm, I live not too far from one too:


6 March 2002
Workers discovered a foot-long cavity eaten into the reactor vessel head at the Davis-Besse nuclear plant in Ohio. Borated water had corroded the metal to a 3/16 inch stainless steel liner which held back over 80,000 gallons of highly pressurized radioactive water. In April 2005 the Nuclear Regulatory Commission proposed fining plant owner First Energy 5.4 million dollars for their failure to uncover the problem sooner (similar problems plaguing other plants were already known within the industry), and also proposed banning System Engineer Andrew Siemaszko from working in the industry for five years due to his falsifying reactor vessel logs. As of this writing the fine and suspension were under appeal.


So you will have to excuse me if I am a bit concerned about ensuring strong safety controls. Even with this, I am very much for continued operationa dn building new nuclear plants.


Take a look at France and tell me how often they have a serious problem.A nation that gets 80% of their power Nuclear plants.
Did you mistakenly infer that I was against nuclear power? For the record, I am not.


Upgrades [of refining capacity] are more a desperate bandade way to try keeping up with the demand.

Your opinion is noted but not necessarily shared by the oil companies.

[DoctorDoom]

I am a huge proponent of nuclear power. Of course it requires very strict safety controls.Do you suppose that there are not? Is the spectre of Chernobyl looming? Scientific fact: the events at Chernobyl are impossible in western reactors, by the laws of physics.

The RBMK-1000 (Reaktor Bolshoi Moshchnosty Kanalny) has the advantage of being able to use natural uranium (unenriched), but the design is unstable. It could not be licensed in the west. It is a graphite-moderated reactor with a positive void coefficient, meaning that a LOCA increases the reactor output. In the case of Chernobyl 4, as the core heat increased and the water boiled away, the chain reaction ramped up, boiling the remaining water even faster. The increase was irreversible. In a matter of seconds, the enormous steam pressure blew the lid off of the reactor. The inrush of air provided oxygen, and the graphite in the core ignited. The rest is history.

It is critical to remember that the test of the reactor that was being conducted required the bypassing of safety systems that would have prevented the test conditions. Were the safety systems active, Chernobyl would still be just an obscure name on the map of the Ukraine.

Contrast that with TMI-2, the worst possible LOCA in a US reactor. Despite the egregiously ignorant hyperbole from the MSM and the no-nukes loonies, the final result of TMI was zero deaths, zero injuries, a minimal release of radiation, and a big cleanup bill.

Why? First, the design of PWR/BWR units results in a shutdown of the chain reaction in the event of a LOCA. If the coolant fails, the reaction ends. And second, it's because in the US, the overarching design consideration is defense in depth. If one safety system will do the job, two or three will do it better, and they are installed.

This is not the place to go into a long-winded discussion of defense-in-depth and ALARA, but your "very strict safety controls" have been in place from the beginning, and they have been made even safer since TMI.

Fact: in an earthquake, a nuke plant would be the safest place.

[DoctorDoom]

Re Davis-Besse, this is the sort of pseudoscientific bullshit that the no-nukes assholes routinely peddle as "fact":

Davis-Besse Nuclear Plant Comes Close To Disaster ... (http://www.nirs.org/press/03-13-2002/1)

Objectivity and accuracy are alien concepts to the morons of the NIRS, UCS and other "scientific" groups whose only qualification for membership is the ability to pay the annual dues. BTW, the link to that page from another page on the site uses the alarmist hyperbole, "We Almost Lost Toledo! Davis-Besse Nuclear Plant in Ohio Comes Close To Disaster."

"We Almost Lost Toledo!" What sort of idiots are they? And what sort of fools do they assume that their visitors are?

IAC, to those assholes, "almost" always equals a fait accompli. If something could have happened, then it did happen. Of course, they never tell us how every airplane on its final approach is "amost" a disaster, prevented only by the proper operation of the plane's systems.

And here's the clincher about how colossally deceitful the cretins are:

http://www.nirs.org/images/nirs.gif

The big hand crushing the cooling tower might impress the ignorant sheeple who visit the site, but the lying bastards never inform their <s>suckers</s> supporters that the cooling towers are completely separate from the nuclear systems, and that such towers are also found at fossil-fuel plants.

The image is about as meaningful as a hand crushing a radiator as a symbol of the dangers of a steam heating system.

Obviously, the D-B operators needed a comeuppance. However, the screeching rhetoric of the NIRS ignores that the reactor vessel is inside the reactor building which is inside the containment building, and the likelihood that a breached reactor lid would have resulted in the failure of the multiple containments and the annihilation of Toledo by 80,000 gallons of water is, to be very kind, ludicrous.

[Naturalized-Texan]

The amount of radiation released at TMI was the equivalent of the increased radiation one would experience by traveling from near sea level at Houston to 5280 feet in Denver.

[sunsettommy]

Borgia,

I live near the Hanford #2 reactor.

They have a containment system that may be the best in the world.

It is said that if there was a crane big enough to lift the entire reactor section(this includes the concrete walls,floor and ceiling).It would stay intact.

The Steam vents are 9 feet across and they are completely separate from the reactor vessel.The water never has radiation added to it because it is a separate system from the reactor vessel.

I have been in a tour of the other plant there that is 68% complete and I was impressed at the design.It is quite easy to prevent a serious problem.

[sunsettommy]

Sunsettommy
Take a look at France and tell me how often they have a serious problem.A nation that gets 80% of their power Nuclear plants.



Borgia
Did you mistakenly infer that I was against nuclear power? For the record, I am not.


How did you get the idea I was inferring that you were against Nuclear Power?

All I did was refer to France and their evident acceptance of Nuclear Power and asked you about them having a serious problem with them.

Maybe you answer next time?

I asked because since they have most of their power from Nuclear.There is an increased chance of a serious failure.Has there been one?

Maybe you answer this one?

It is after all about safety designs.

USSR flunks them.

America and France have good safety record.

[sunsettommy]

Hmm, I live not too far from one too:




So you will have to excuse me if I am a bit concerned about ensuring strong safety controls. Even with this, I am very much for continued operationa dn building new nuclear plants.


Did you mistakenly infer that I was against nuclear power? For the record, I am not.



Your opinion is noted but not necessarily shared by the oil companies.


Yup it is an opinion ,but you never did answer the question:


Then tell us how they can build new MODERN refinery plants now.


Does it cross your mind that building NEW ones would increase their profit margin? Having more refineries reduces maintenance costs since they no longer have to go 100% capacity like they often do with the old ones.

[DoctorDoom]

Does it cross your mind that building NEW ones would increase their profit margin? Having more refineries reduces maintenance costs since they no longer have to go 100% capacity like they often do with the old ones.And since they would be built using state-of-the-art technology, they would be more efficient and less prone to breakdown. More productivity = more earnings.

[Borgia]

How did you get the idea I was inferring that you were against Nuclear Power?

All I did was refer to France and their evident acceptance of Nuclear Power and asked you about them having a serious problem with them.

Maybe you answer next time?

I asked because since they have most of their power from Nuclear.There is an increased chance of a serious failure.Has there been one?

Maybe you answer this one?

It is after all about safety designs.

USSR flunks them.

America and France have good safety record.


Look, American DOEs have a good safety record for nucelar power and that is a reason why I am FOR it. Yet we have had some close calls that could have been problematic. We just need to make sure we keep the safety protocols we have and perhaps learn from our mistakes. That is all I am saying.

[Borgia]

Does it cross your mind that building NEW ones would increase their profit margin? Having more refineries reduces maintenance costs since they no longer have to go 100% capacity like they often do with the old ones.

Or it could DECREASE their profit margin. I'll trust the oil companies know better the ROI on refineries better than you or I.

Like I said earlier, no oil company is going to build a refinery that is designed to operate at 60% capacity. Too long to recoup your money. Study Operations Management of Production Planning - it is a basic tenet of it.

[Rhino]

Actually, scalability is built in to any commercial venture. Without it, you'd be cutting your own throat.

[Borgia]

Actually, scalability is built in to any commercial venture. Without it, you'd be cutting your own throat.

A certain amount of scalability is fine, but usually company's will attempt to predict the future output probabilities, and then balance that with the ROI. Rarely will businesses take too much risk.

[Rhino]

True, they attempt to mitigate it wherever possible. But not being able to respond to increasing market demands is also a risk to future viability, and they take that into account as well. It's all somewhat of a crapshoot when you can't reliably predict the future, but they most often do provide a way to increase capacity whenever feasible.

[Warlady]

People need to start looking at the oil companies themselves. I mean it doesn't take a f**king genius...

The oil companies claim the prices are not jacked up... and yet in the very next breath they announce record profits for the second time straight. Hmmm I wonder how THAT happened? And then they proudly parade one of their exiting puppets in front of the media and flaunt it to the American public that this butt licker is leaving with a retirement package worth over $300 million. But no, their prices aren't jacked up in the least.

Is it really that hard to figure out where the record profits and multi-million dollar retirement packages are coming from?
:question:

You have a problem with a business making a healthy profit? I don't. I also don't care how much they pay their executives. Supply and demand. Capitalism. It's a wonderful thing. I know for a fact they work their asses off. My husband is in the oil bidness and he works 7 days a week. I get to see him about 3 hours a day. You want to complain about gas prices give OPEC a ring. Or talk to the Democrats about drilling off the coast of California which is oil rich or talk to the Democrats in the North East. That coast is oil rich too but Ted Kennedy runs that area. Fox news just reported that Massachusetts wants to install a wind farm off shore which would provide energy for all of Cape Cod but unfortunately you can see it from the Kennedy compound so that has been botched.