Posted on 05/19/2008 9:55:47 AM PDT by kellynla
With fill-ups routinely costing $60 or more, cost-conscious drivers naturally look for someone to blame. And just as naturally, politicians are happy to blame others.
Enter "Big Oil," the demagogues' favorite villain. Gas prices soaring? It's because oil companies want "excess profits," as Barack Obama puts it. Right? Wrong. The truth is more complicated.
Let's look to California, driving capital of the world. Officials there watch gas prices carefully. During March and April, a state analysis found "distribution costs, marketing costs and profits" made up about 10 cents of the cost of a gallon of gasoline, which ranged from $3.46 to $3.89. Notice that dime is less than 3 percent of the total retail cost, and profits account for only part of it. So those "excess profits" are actually well below 3 percent of retail costs.
Of course, that's little comfort to tapped-out drivers. And the big oil companies are certainly making big money — Exxon Mobil alone earned $40.6 billion last year. But such profits follow naturally when a company sells a product so many people want to buy. Some recent history offers us a bit of perspective.
In 1998, a recession in Asia created an oil glut. Prices plunged to historic lows (near $10 a barrel), and American drivers reaped the benefits, with gas dipping below $1 per gallon. So how did Exxon fare in those days of low prices?
According to Forbes magazine, Exxon earned more in profits than any other American company in 1998. Sales increased 3 percent over 1997 and profits jumped 12.6 percent, to $8.4 billion. Again, remember: Oil was remarkably cheap that year, yet Exxon earned double-digit profits. Few complained then.
(Excerpt) Read more at washingtontimes.com ...
ping
Drill in the US, drill offshore, drill (and scoop) in Canada and drill in Mexico or shut the border.
The US Congress...for the Polar Bears, not the people...
The top 3 news stories on my local Fox affiliate this morning were:
1. Americans are suffering terribly due to the price of gas and that price is set to rise to $4 a gallon. (Yes, the word “suffering” was used several times in this 30 second spot.)
2. The top box office movies this weekend were X, X and X. When I totaled the revenues it was near $100M. (Amazing, I thought the price of gas was making us suffer!)
3. China has declared 2:28 PM today to be a time of mourning for those that were killed by thet earthquakes. Many Chinese are without food and water. (Now, that is suffering.)
There are 1400 exploratory wells being drilled in the USA right now.
We need some kind of call in to your rep strategy, like was done about Immigration. We need to make the phone lines melt.
We're suppose to swallow this BS? Who exactly did this "analysis"? Who are they associated with? Who do they work for? So, based upon this article, we are to believe that only 10 cents out of $3.899 is from the total cost of distribution, marketing, and profits!!!!! And I have beach front property in Arizona I want to sell with a beautiful view of the Atlantic Ocean. Of course, that's little comfort to tapped-out drivers. And the big oil companies are certainly making big money — Exxon Mobil alone earned $40.6 billion last year. But such profits follow naturally when a company sells a product so many people want to buy.
Yeah, this is just a product of convenience for people, and not something we need to buy. We could all just as easily just stop buying this product if we so choose, just as we could stop buying coffee or soda. This article is full of BS. I'm going to have to start wearing boots when I log onto FR and read threads like this.
I’m forming the Cheap Energy Now party. My emblem will be a derrick and bulldozer.
I pity the eco-nut who lays down in front of the Cheap Energy Now party march.
So EXXON did well during the low price two months in 1998, huh? Funny, the gas is a bargain at any price crowd told me that like 90 percent of the oil workers were basically forced to panhandle because of cheap prices.
Is that your own opinion?
If so, would you show us a different study about the subject?
Every driver who is fed up with paying $70 for a fillup at the gas pump ought to direct his/her fury at their Congressman for caving to the inconsequential numbers of voters who belong to the enviro-nazi cult in the US. Why can such a small number of loudmouths dictate the energy policy of the nation?
ANWAR belongs to all of us and we need our oil. If that rotten Bill Clinton had not vetoed drilling in the ‘90s, we would be using that extra 1,000,000 barrels right now.
Why do the brain dead Republicans not confront the Dems every day with the fact that they are responsible for the pain at the pump for the middle class they claim to be championing?
bump
What is bad for the people is good for the ‘Rats who just last week voted to filibuster an amendment that would have opened ANWR and some of the Alaskan coast for drilling.
Here is a comprehensive study that you may want to read. This link is the executive summary:
I'm talking about the claim that "10c per gallon covers distribution and profit" is BS.
It appears we may first have to drill some holes in our elected, both parties, before we can proceed to take advantage of OUR nations energy capabilities.
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