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Originally posted by Stazi:
Originally posted by JaTo:
Here we go again...
1) Refining capacity has been a PROVEN bottleneck; we have more oil in the chain than we have GAS being produced. Basic supply/demand here.
I don't see ANY shortages ANYWHERE so I don't buy that argument - even the Hurrican Katrina induced gouging was unjustified as it happened THE DAY the hurrican hit, when the gas was already sitting i the tanks at the stations!
The actual "gouging", where prices skyrocketed dollars a t a time, was a product of station owners. Gas companies don't own most of their stations (and none of the ones accused of gouging), independent owners do.
Gas prices did go up a fair bit in other places, as a deterrent to prevent people from sucking all the gas out of the tanks and causing a real shortage. These prices last 2-3 days, when it was clear that the supply lines weren't as disrupted as feared, the prices went down. And went down to lower than they were before in most places.
Quote:
Originally posted by JaTo:
3) Iran is the 4th largest oil-producing country in the world and like Venezuela (another oil behemoth), their ties to the West have "soured" as of late. There is a risk component to the price of crude oil and political instability with one of the world's largest consumers of oil and a couple of the world's largest producers of it tends to SPIKE this component.
There's MANY oil producing nations to offset bad blood with Iran and Venezuela - this is another moot point
When the world is running at a tight supply, ANY disruption of any size is significant. It's basic economics.
When supply is tight and there are disruptions, speculators go crazy to ensure that they get all the oil that they need. A disruption of just a few percent can result in an exponential rise in price as the price of the product is bid up so that buyers can ensure that they get what they need.
It doesn't even have to be a real disruption. It can be a potential problem that is totally in the minds of those individuals (not companies) that control the price of oil on the market.
Quote:
Originally posted by JaTo:
4) Speculation is what the price of oil is pretty much hinged upon. Speculators adjust the price that they are willing to pay for oil due to current factors vs. what they feel future factors will be like. Given all of today's factors (summer demand, forumlation changes, political instability, oil supply concerns, etc., etc., etc.), the price has gone UP.
Way to just create another oint using the above points, which I have rebutted.
Rebutted? YOu haven't rebutted anything. There's a different between denial and rebuttal.
Quote:
Originally posted by JaTo:
6) Microsoft makes over 60-70% margin on the software products that consumers typically buy. Exxon and other oil companies on a GOOD day with a commodity such as oil or gas usually make single-digit margins (8% at last look). I don't see people in the streets protesting the margins that biotech firms make or the margins that many SW companies make...
Margins are one thing - actual profit is another - not one industry comes close to the profit that Gas companies are creating! This is because gas is sold in such large quatity, compared to a copy of Windows or a bottle of antibiotics!
Margins are not "one thing". They are the thing. They are the definition of gouging. You CANNOT "gouge" with single-digit profit margins; you can't even "gouge" with 50% margins. That very simply means that you're not charging that much more than it costs to produce.
I see you understand how profits are so high -- because the volume of the goods that are sold. When you sell more stuff you make more profit -- to the exact same ratio. So I fail to see how you think that's a problem.
When Exxon was charging 8% margins back when gasoline was $15/barrel and it was struggling to keep itself afloat because 8% of $15 ain't much at all, I didn't see anyone out there trying to help them out. But now that they're charging roughly the same margins when the price of their product is higher they're "gouging" you?
If I buy something for $1.00 and sell it to someone else for $1.08, I am very simply not gouging anybody.
Or is your convoluted logic that $0.08 on a dollar isn't much to make but $8 billion on $100 billion is? Because they're the exact same thing. 8% is 8% is 8%. 8% is low. It's so low that Exxon's stock dived this morning because Wall Street isn't happy with their returns.
What do you want them to do? Lower their margins as their revenues go up? That's about the most retarded thing I've ever heard. Who wants to own shares in a company that makes 1% margins? Lord knows I don't. I can make a several times that return putting my money into Treasury Bonds.
Quote:
Originally posted by JaTo:
7) The US has consistently paid some of the cheapest overall prices for gasoline since automobiles came into existance. There is a tax component that is associated with gas that many other countries inflate beyond belief, but that does NOT change the fact that gas has been a VERY cheap commodity for the US over the years.
This although true, does not JUSTIFY the sudden 300% increase in gas over the last 5 years!!! The last time gas went up 300% it took 20 years!
And the fact that oil has gone up 300% in 5 years doesn't justify blaming Big Oil. The market sets the price of oil, not companies. Big Oil might get to benefit from it, but they don't cause it.
If you want to point fingers, point at the speculators that drive the price of oil up $10 when the leader of Iran sneezes too loud.
Quote:
Originally posted by JaTo:
In short, quit swallowing the fetid BS that the media tosses out to further sensationalize a hot-button issue. There's reason for concern about the price of oil and gas, but I'm tired of this lemming-mentality that states oil companies are "fixing" prices and "screwing" the consumer here.
THINK, PEOPLE!!!
Screw you....it's out and out gouging and I hope Congress uncovers it and we get back to sane pricing.
PS which gas company do you work for? 
:rollseyes: Go educate yourself on what "price-gouging" is. $8 billion in profit on almost $100 billion in sales, is anything but.
Let's put it another way that might make more sense...
If Exxon-Mobil took all that profit out of a tank of gas, your $3 gallon of gasoline would go down to $2.76. OMG 24 cents! Whatever am I going to do! 
PS I don't work for a gas company. I do work for the second largest consumer of diesel fuel though.
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Originally posted by Stazi:
Originally posted by JaTo:
Here we go again...
1) Refining capacity has been a PROVEN bottleneck; we have more oil in the chain than we have GAS being produced. Basic supply/demand here.
I don't see ANY shortages ANYWHERE so I don't buy that argument - even the Hurrican Katrina induced gouging was unjustified as it happened THE DAY the hurrican hit, when the gas was already sitting i the tanks at the stations!
Originally posted by JaTo:
2) Gas formulation laws have also taken their toll on prices; we've just gone through a recent switchover that has been a more costly one for refiners. Costs like this have to be passed on to the consumer, unless you can get Congress to open their purses and pay for the changeover...
This new formulation has barely even an effect on the normal formulations we use today - we can you even BUY these new formulations?????
Originally posted by JaTo:
3) Iran is the 4th largest oil-producing country in the world and like Venezuela (another oil behemoth), their ties to the West have "soured" as of late. There is a risk component to the price of crude oil and political instability with one of the world's largest consumers of oil and a couple of the world's largest producers of it tends to SPIKE this component.
There's MANY oil producing nations to offset bad blood with Iran and Venezuela - this is another moot point
Originally posted by JaTo:
4) Speculation is what the price of oil is pretty much hinged upon. Speculators adjust the price that they are willing to pay for oil due to current factors vs. what they feel future factors will be like. Given all of today's factors (summer demand, forumlation changes, political instability, oil supply concerns, etc., etc., etc.), the price has gone UP.
Way to just create another oint using the above points, which I have rebutted.
Originally posted by JaTo:
5) The price of oil and gas per gallon is less than many other liquids that you purchase on a daily basis. If we priced Budwiser out per gallon, you'd be paying around $8/gallon for it. Where is the outrage there?
Last time I checked, no one goes through 20 gallons or wine, beer, or milk a week, not without dying - that comparison is ridiculous!
Originally posted by JaTo:
6) Microsoft makes over 60-70% margin on the software products that consumers typically buy. Exxon and other oil companies on a GOOD day with a commodity such as oil or gas usually make single-digit margins (8% at last look). I don't see people in the streets protesting the margins that biotech firms make or the margins that many SW companies make...
Margins are one thing - actual profit is another - not one industry comes close to the profit that Gas companies are creating! This is because gas is sold in such large quatity, compared to a copy of Windows or a bottle of antibiotics!
Originally posted by JaTo:
7) The US has consistently paid some of the cheapest overall prices for gasoline since automobiles came into existance. There is a tax component that is associated with gas that many other countries inflate beyond belief, but that does NOT change the fact that gas has been a VERY cheap commodity for the US over the years.
This although true, does not JUSTIFY the sudden 300% increase in gas over the last 5 years!!! The last time gas went up 300% it took 20 years!
Originally posted by JaTo:
There is a reason Bill Gates is the richest guy on the planet and a reason that you be hard-pressed to find any "Big Oil" executive on the "most wealthy" list; there's also a reason you will find MANY oil sheiks from the Middle-East on that list, too.
Their are more wealthy sheiks then there are "Bill Gates", once again due to the VOLUME of PRODUCT being sold and the number of sheiks who sell said product comared to the number of big software companies.
Originally posted by JaTo:
In short, quit swallowing the fetid BS that the media tosses out to further sensationalize a hot-button issue. There's reason for concern about the price of oil and gas, but I'm tired of this lemming-mentality that states oil companies are "fixing" prices and "screwing" the consumer here.
THINK, PEOPLE!!!
Screw you....it's out and out gouging and I hope Congress uncovers it and we get back to sane pricing.
PS which gas company do you work for?
A few things to think about Stazi, I'm not going to hit all of your points, because I used to have the same thining pattern as you, but think about how India and China's economies have been growing tremendously late, hence the 'supply & demand shortage.' As for your oil production arguement, the Iran, as you know is a part of OPEC and since they are stirring hte pot, OPEC dictates the price of crude oil. There aren't many other countries with the infrastructure that the OPEC countries have to meet the demands of the world.
there was more to this post, but work distracted me..
Ryan
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I am suprised no one has mentioned that China and India are starting to suck up a decent chunk of the oil out there, and they are only going to want more.
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India and China although becoming HUGE industrial nations, are WAAAAYYY behind the US in terms of oil usage due to the fact that hardly ANYONE in either of these two countries can afford to own/use cars. The "family vehicles" in China and India and the rest of Indo-Chine usually is a 125cc scooter - hardly compares to the oil consumption of the US, so I don't see them sucking up the oil the US was looking for.
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Originally posted by Stazi:
India and China although becoming HUGE industrial nations, are WAAAAYYY behind the US in terms of oil usage due to the fact that hardly ANYONE in either of these two countries can afford to own/use cars. The "family vehicles" in China and India and the rest of Indo-Chine usually is a 125cc scooter - hardly compares to the oil consumption of the US, so I don't see them sucking up the oil the US was looking for.
*sigh*
It doesn't matter the quantity that they demand. The fact is that there isn't enough being pumped to meet it. So, what do you do? You charge more for what you got and you sell what you have to whomever is willing to pay the most for it. Basic economics.
And you vastly underestimate the demand for oil in China. China is the world's second largest consumer of oil. Does it demand as much as we do? No. But it demands about 40% of what we do. Considering that just 10 years ago that was more like 20% and 5 years before that it was more like 10% and you see the problem -- incredibe demand growth that has outpaced the ability to increase supply to match. So you end up with a net difference that tightens supply. When supply tightens and/or people fear shortages, they bid the price up to ensure that they get what the need.
In order to not lose just 5% of what they need people are willing to pay double or triple to ensure that the get it all that they need. We see that at the pumps now. But the same exact thing happens on the crude oil markets just on a larger scale.
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-IMO, if you can't beat em, join em. Buy some oil stocks, they are all doing very well right now. Better than paying more money for nothing in return.
-I don't have huge sympathy for most people, on gas prices. Around here the "average" vehicle I would say is probably a full size pickup, then maybe a medium to full-size SUV. 'nuff said on that.
-I don't understand why we haven't seen more of a push towards ethanol, or even E85. GM has been advertising the hell out of, but where are all the other companies in the auto industry, or the oil companies for that matter. Everyone keeps saying that fuel cells are going to be the next big thing, and they probably will be, but not for quite a while, we're in the present, not the future and a better solution is needed in the interim, IMO.
-If we need more refineries we should build them in friggin Mexico, last time I checked their enviro standards weren't nearly the same as ours, and with NAFTA, getting across the border shouldn't be as hard.
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Originally posted by Stazi:
India and China although becoming HUGE industrial nations, are WAAAAYYY behind the US in terms of oil usage due to the fact that hardly ANYONE in either of these two countries can afford to own/use cars. The "family vehicles" in China and India and the rest of Indo-Chine usually is a 125cc scooter - hardly compares to the oil consumption of the US, so I don't see them sucking up the oil the US was looking for.
those two combine = U.S. oil consumption of 10 years ago. at least that is what I heard today...need to look more into it.
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Why not look to our farmers to provide our fuel? Corn and soy beans could give us E100, or we could even produce our own 100% US E85 and we could make our own bio-diesel.
That would also mean that we would not have to subsidize the farmers at all, we'd be pumping billions into OUR economy.
Other than the fact that the lobbyists have their arms crammed so far up the politicians asses, I simply do not get why this isn't an option for the United States. Brazil did it, why can't we?
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Originally posted by TC'd Swazo:
Why not look to our farmers to provide our fuel? Corn and soy beans could give us E100, or we could even produce our own 100% US E85 and we could make our own bio-diesel.
That would also mean that we would not have to subsidize the farmers at all, we'd be pumping billions into OUR economy.
Other than the fact that the lobbyists have their arms crammed so far the politicians asses, I simply do not get why this isn't an option for the United States. Brazil did it, why can't we?
If we didn't subsidize the farmers, E85 would be outrageously expensive. There's nothing cheap about growing corn to produce fuel. Even worse it takes 1.5 gallons of E85 to take you as far as 1 gallon of gas. So it costs alot more to go the same distance. The cost difference coupled with the efficiency difference means that ethanol costs twice what gasoline currently does to move your car the same distance.
And to grow enough ethanol to replace our gasoline, we'd have to turn over 70% of our farmland to growing corn. Obviously not gonna happen. We could only afford to turn over a few percent of our land to such an alternative use.
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