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Originally posted by RTStabler51:
So, when the price per barrel dropped for a few weeks solid a month or so ago, why didn't gas prices drop accordingly?
Prices went down accordingly around here. Was actually pretty nice.
It's still not anywhere near where it WAS. Right now, it's $2.50 for 91, down from over $3.10 a few months ago.
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Originally posted by RTStabler51:
Originally posted by sigma:
Originally posted by loggerbomb:
you cant tell me making one billion dollars in one quarter and having small margins goes hand in hand.
It doesn't take a genius in economics to figure it out.
When you make $500 Billion a year in revenues, even if your margin is just 1%, you made $5 Billion.
As the price of oil has gone up and the price of gas has gone up, the revenues from selling gas has gone up. When the price of what you're selling goes up by double, even if your profit margin stays exactly the same, your profits double. The margins of Big Oil aren't excessive at ~6-9% and are FAR lower than many other companies in a variety of industries and in-line with what the market considers an average, healthy company.
It isn't that complicated.
Yeah that's why they refer to profits isn't it? I mean when you make what was it 200% more in profits I don't feel sorry for you....
They refer to profits because it's the "sky is falling" news that everyone wants to hear. Inventors refer to profit margins since that's what matters. $10 Billion might seem like a lot of profit to most people -- but not if your company sold $500 Billion worth of goods. that's a [censored] margin. Your company might as well not even be in business, you'd make more money closing shop, taking your cash, and investing it in a mutual fund.
But if the price of crude oil went up 200% and your profits don't go up at least the same, that's bad. Investors would be livid. That would means margins would have dropped from 7% to 3.5%. Stock prices would fall like a stone.
No one's asking you to "feel sorry" for Big Oil, just don't blame them because their sole required resource has doubled in price and they're passing on that doubling in price to you (and they're not even doing that; they're passing on like 95% of it and eating the rest). And don't accuse them of "price gouging" when their margins have stayed roughly the same for years now. Big Oil could take every single penny of profit out of the price of gas and the price would only fall 15 cents.
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Originally posted by RTStabler51:
We still are way better off than Europe with our gas prices, but something has got to change. Either us and our wants and needs (which I highly doubt) or the oil companies seeing what they are doing to the less wealthy Americans.
Which I highly doubt.
I'm no better, but things aren't going to change until Americans start doing things differently. Gas prices are higher in Europe but their whole society is set up differently so that the fact that gas prices are higher probably doesn't really effect too many. They aren't so reliant on single passenger cars. They actually use public transportation, there is public transportation available to use (not an option for me), they commute via bicycle, they aren't so spread out.
But like I said, I'm no better. I don't know what the answer is. Oil is a finite resource, and as the demand grows (which it probably always will) and the resource gets depleted, supply/ demand will force the price up.
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As an aside to this discussion, why are people not rioting in the streets about the 70% margin that Microsoft makes on most of their products vs. the single-digit margins that most oil companies make???
The banking industry on average rakes in 15-20% margins, so just because it's not a horribly capital-intensive industry, they get a pass and energy companies do not? It doesn't take a fraction of the sunk costs or capital to run the largest bank in the world vs. the largest oil company, so due to the "nature of the beast" the oil companies are labeled "evil"?
Come on, folks. This is BASIC economics here; there's some smoke and mirrors in the mix, but the US consumer is NOT getting arbitrarily gouged at the pump. The CEO of Exxon doesn't have a "screw the consumer" lever at his desk that he pulls when he thinks he should be getting more dinero out of us...
Congress isn't the smartest bunch on the planet, but after a numebr of sessions that eyed the profits that oil companies have made in the past year, you'd think they would have dug up something incriminating, right?
If you want to control the price of gas, write your Congressman and tell him you want curbs put on energy futures...
JaTo
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Dude I feel your pain... LAst week the price of my inkjet cartridges went up 50 cents making it cost about $4000/gallon.
And then Evian had the nerve to raise the price of their water to $6/gallon! THE NERVE!
Stop whining, it's not that much. And make sure you understand the difference between profit and profit margin.
If you want cheaper gas, move to Venezuela or Bahrain or something.
Sal Khan
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Originally posted by mean'tour:
Originally posted by RTStabler51:
We still are way better off than Europe with our gas prices, but something has got to change. Either us and our wants and needs (which I highly doubt) or the oil companies seeing what they are doing to the less wealthy Americans.
Which I highly doubt.
I'm no better, but things aren't going to change until Americans start doing things differently. Gas prices are higher in Europe but their whole society is set up differently so that the fact that gas prices are higher probably doesn't really effect too many. They aren't so reliant on single passenger cars. They actually use public transportation, there is public transportation available to use (not an option for me), they commute via bicycle, they aren't so spread out.
But like I said, I'm no better. I don't know what the answer is. Oil is a finite resource, and as the demand grows (which it probably always will) and the resource gets depleted, supply/ demand will force the price up.
its too bad that north american population centres werent as densely packed as european ones, would make public transport a lot more viable on a wider scale. But im stuck out in a rural area, so unfortunately for me im stuck having to commute.
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Originally posted by SalKhan:
Dude I feel your pain... LAst week the price of my inkjet cartridges went up 50 cents making it cost about $4000/gallon.
And then Evian had the nerve to raise the price of their water to $6/gallon! THE NERVE!
Stop whining, it's not that much. And make sure you understand the difference between profit and profit margin.
If you want cheaper gas, move to Venezuela or Bahrain or something.
Yeah, I'm glad you know me so well. Alot of posts here have enlightened me somewhat on excactly as JaTo called them the smoke and mirrors going on with the numbers. But, since you decided to be the asshat in a civil post, I run B20 in my Jeep, so I am probably do much more to aid in the situation than you are. I'm glad that you don't care where you are spending money and its obvious that you have so much like all the wealthy Contour owners here do!
Ryan
Trollin!
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Civil? Originally posted by You:
Answer: Because the oil company doesn't care about people! Thanks oil companies! I hope your huge profit margins explode in your face, even though I know they won't. Oh well.....
That's not civil.
I contributed by moving to a run down place 1.7 miles from work. I contribute by riding a motorcycle that gets 50 MPG in the rain at times. I contribute by recycling over 500 lbs of fryer grease a month. I contribute Mistah Vitamin B20.
I'm the Juggernaut B!tch!
Originally posted by RTStabler51:
Yeah, I'm glad you know me so well. Alot of posts here have enlightened me somewhat on excactly as JaTo called them the smoke and mirrors going on with the numbers. But, since you decided to be the asshat in a civil post, I run B20 in my Jeep, so I am probably do much more to aid in the situation than you are. I'm glad that you don't care where you are spending money and its obvious that you have so much like all the wealthy Contour owners here do!
Sal Khan
00 SVT - Not pretty
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http://www.thelunchjournals.com
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Originally posted by RTStabler51:
Why the price hike?
Answer: Because the oil company doesn't care about people! Thanks oil companies! I hope your huge profit margins explode in your face, even though I know they won't. Oh well.....
Easy answer.
Summer's coming, and with summer comes increased driving. This leads to more gas being used so they up their price.
They're a business. Their job is to make money, they don't owe anybody [censored].
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Originally posted by JaTo:
The banking industry on average rakes in 15-20% margins, so just because it's not a horribly capital-intensive industry, they get a pass and energy companies do not? It doesn't take a fraction of the sunk costs or capital to run the largest bank in the world vs. the largest oil company, so due to the "nature of the beast" the oil companies are labeled "evil"?
Hey, I told Royal bank of Canada, along with their 1+bn profits and their $10/mo charges to [censored] off and switched to a no-fee credit union. Couldn't be happier 
If you don't like the cost of gas, buy a more economical car or get a diesel.
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