Ahhh, the oil companies

[registerthis]

Text of an email a friend of mine sent to me. I swear, how DOES The American public just sit here and swallow this stuff? It's truly baffling.


I'm so glad the Republicans in Congress and our President just signed a massive new energy bill that provides subsides to these poor struggling petroleum companies that serve our public so well. Here's what I found in a 10-minute internet browse of corporate websites and their own earnings data for the 2nd Quarter of 2005…you know, when Americans saw the price of gas nearly double in a few months. Try to keep in mind that these figures are for NET EARNINGS (profits) and for a mere 90 days of operations:

ExxonMobil: $7.6 BILLION
Royal Dutch Shell: $4.6 BILLION
British Petroleum (BP): $3.9 BILLION
Chevron: $3.7 BILLION
Sunoco: $0.2 BILLION

So that's just 5 big oil companies (and Sunoco is far smaller than the others), and these guys recorded $20,000,000,000 in PROFIT in the last 3 months alone. And this is an industry that can't resist passing along 100% (if not more in the last week!) of the increasing price of crude directly to the public, hence weakening our overall economy by increasing travel, shipping and production costs in virtually all sectors of the economy. Nice job minding the store, W…..

[savafan]

That's not to mention that they just raised the price of gasoline that they already had in the tank which was bought last week at a lower price than what oil is selling for now.

[M2]

Here's what I don't get (to expound on what sava said), why did the price of gasoline at the pump go up yesterday?

Katrina has caused all kind of problems for all kinds of industries, but you didn't seem that immediately speculated upon and passed onto the consumer. For instance, you could have bought Zatarin's rice mixes for it pre-Katrina prices even though Zatarin's may not be able to produce rice mixes for quite some time. Why? Because the retailer had already paid for it and tacked on its markup.

So why doesn't gasoline follow the same model? After all, your local filling station paid a fixed price for the gasoline it sells you. It didn't suddenly pay more for gasoline between noon and 6 p.m. yesterday. Of course your local filling station doesn't determine its prices. It gets the prices dictated from the corporate level and those prices fluctuate in a manner that adheres neither to logic nor the principle of consumer fairness. That this is legal baffles me.

[traderumor]

Those profits in real $ mean little without showing what the profit margin is. Not defending, just need that to put it in perspective.

[pedro]

Those profits in real $ mean little without showing what the profit margin is. Not defending, just need that to put it in perspective.

they are apparently NET profit numbers, not Gross.

[traderumor]

they are apparently NET profit numbers, not Gross.Profit margin is expressed in a percentage.

Here's the numbers for Exxon. Net income before taxes as a % of sales was 14% for 2nd Q 2005, as opposed to 13% in 2004. After taxes, 8% both years. So the Feds got their share, I would think that should make everyone happy. That is a fair margin, but by no means is outrageous. It would be the equivalent of making $40,000 on half a million in sales. Would you consider that to be outrageous? Would you be happy with 8% if it were your business?

http://phx.corporate-ir.net/phoenix.zhtml?c=115024&p=irol-newsArticle&id=736368

[pedro]

Profit margin is expressed in a percentage.

Here's the numbers for Exxon. Net income before taxes as a % of sales was 14% for 2nd Q 2005, as opposed to 13% in 2004. After taxes, 8% both years. So the Feds got their share, I would think that should make everyone happy. That is a fair margin, but by no means is outrageous. It would be the equivalent of making $40,000 on half a million in sales. Would you consider that to be outrageous? Would you be happy with 8% if it were your business?

http://phx.corporate-ir.net/phoenix.zhtml?c=115024&p=irol-newsArticle&id=736368

understood. not excessive in terms of % IMO, especially if compared to the profit margins of pharmaceutical companies.

[traderumor]

understood. not excessive in terms of % IMO, especially if compared to the profit margins of pharmaceutical companies.And trust me, I am grumbling the same as you guys are at the volitility of gas prices and the current level. Thankfully, right now, I drive back and forth to work, maybe 15-20 miles a day. I don't think there has been any change in who is getting rich off oil, and that's OPEC nations.

[registerthis]

Profit margin is expressed in a percentage.

Here's the numbers for Exxon. Net income before taxes as a % of sales was 14% for 2nd Q 2005, as opposed to 13% in 2004. After taxes, 8% both years. So the Feds got their share, I would think that should make everyone happy. That is a fair margin, but by no means is outrageous. It would be the equivalent of making $40,000 on half a million in sales. Would you consider that to be outrageous? Would you be happy with 8% if it were your business?

http://phx.corporate-ir.net/phoenix.zhtml?c=115024&p=irol-newsArticle&id=736368It's not outrageous in terms of a %, no, but keep in mind these are sales of BILLIONS of dollars. Let's say, for the sake of argument, there were $10 billion in sales during 2Q 2005 (I'm sure it's much higher than that, but this is all play money anyway, right?) That is $800 million profit in one quarter--and, like I said, I'm certain that it's higher than that.

So, it begs the question, what on Earth do these companies need a tax break for? That's what baffles me.

[Jeremy Piergallini]

The way it was explained to me is that the independent gas station down the street from you doesn't actually pay for the gas in their tanks until it is pumped into the cars. So while the oil companies are increasing their price to the independents, they have to do the same to afford to even have a gas station. I don't blame the gas stations, but most certainly blame the oil companies.

[Jeremy Piergallini]

According to ExxonMobil's 10-Q, they reported NET INCOME of 15.5 billion up 4.27 billion from the same time period last year.

2.44 per share, up .72 per share from same time period last year.

Hey, they gotta help their shareholders, don't they?

[traderumor]

It's not outrageous in terms of a %, no, but keep in mind these are sales of BILLIONS of dollars. Let's say, for the sake of argument, there were $10 billion in sales during 2Q 2005 (I'm sure it's much higher than that, but this is all play money anyway, right?) That is $800 million profit in one quarter--and, like I said, I'm certain that it's higher than that.

So, it begs the question, what on Earth do these companies need a tax break for? That's what baffles me.Tax break? The numbers I provided were based on about a 40% tax rate, and that's just for the Feds. I don't imagine you would want your personal income to be paid at that rate, would you?

And regardless of how many billions we are talking about, at 8%, Exxon is taking in a lot of money, true, but most of it is going right back out into the economy. If you want to complain about oil prices, go talk to our friends in Kuwait, whose government is so rich that many people live well off of government subsidy. Or any of the other OPEC member nations. They control the supply of oil and therefore the prices in the world. Our domestic companies are at their mercy just about as much as we are as individuals.

[registerthis]

Tax break? The numbers I provided were based on about a 40% tax rate, and that's just for the Feds. I don't imagine you would want your personal income to be paid at that rate, would you?I'm talking about the tax breaks provided in the Energy Policy which was just enacted.

And regarding the 40% rate, no *I* wouldn't want to be taxed at that rate because I don't make nearly enough to justify it. Those who take in a larger amount of wealth have historically been responsible for sharing a higher load of the tax burden. It's why people inheriting a huge estate are taxed at a much higher rate. I just don't see why an oil company raking in these types of profits requires a tax break--what, so they can have MORE profits? I simply don't get it.

[RedsFan75]

Here's what I don't get (to expound on what sava said), why did the price of gasoline at the pump go up yesterday?

Katrina has caused all kind of problems for all kinds of industries, but you didn't seem that immediately speculated upon and passed onto the consumer. For instance, you could have bought Zatarin's rice mixes for it pre-Katrina prices even though Zatarin's may not be able to produce rice mixes for quite some time. Why? Because the retailer had already paid for it and tacked on its markup.

So why doesn't gasoline follow the same model? After all, your local filling station paid a fixed price for the gasoline it sells you. It didn't suddenly pay more for gasoline between noon and 6 p.m. yesterday. Of course your local filling station doesn't determine its prices. It gets the prices dictated from the corporate level and those prices fluctuate in a manner that adheres neither to logic nor the principle of consumer fairness. That this is legal baffles me.

Reading through this, you make a good point except for one small problem.
I have an old family friend who owns a gas station. SEVERAL years back the oil companies stopped selling the gas to the retailers. He doesn't own the gas in his tanks. They did this to stop the wild fluctuations in prices. In rural areas the trucking company would add transportation costs and the station owner would have to increase his price to cover it, so your country gas prices were always more than the city prices. In late 70's early 80's they stopped this, and the thought at that time was that it was a good thing because the price would be the same for everyone. HA! now we see what the real strategy was! My understanding of how it works since then, is the fuel is distribute to a local wholesaler and that distributer then sets the pump price and fills the local stations orders. In my friends case, he has the same gas in his tanks that they pump into the tanks of the local BP, and the local Citgo, and the local... well you get the picture.

[registerthis]

Hey, they gotta help their shareholders, don't they?Oooh, we have a winner.

[traderumor]

According to ExxonMobil's 10-Q, they reported NET INCOME of 15.5 billion up 4.27 billion from the same time period last year.

2.44 per share, up .72 per share from same time period last year.

Hey, they gotta help their shareholders, don't they?Yea, its a little hard raising money to run a company without giving shareholders a benefit. I imagine you volunteer your human resources to your company? You put money in a bank and don't want them to pay interest?

[registerthis]

I'm sorry, but when I read stuff like this, and then have to go pay $3.15/gallon to fuel my car (as I did last night) it makes my stomach churn.

Taken from: http://www.washingtonpost.com/wp-dyn/content/article/2005/07/28/AR2005072802085.html


Profit Soars at Exxon Mobil
Surging Oil Prices Lead to Company's Best Second Quarter

By Joe Carroll
Bloomberg News
Friday, July 29, 2005; Page D02

Exxon Mobil Corp., the world's largest publicly traded oil company, said yesterday that second-quarter profit rose 32 percent, to $7.64 billion, as Asia and North America used more crude oil and gasoline.

The quarterly profit was the third-highest in the company's history. Revenue climbed 25 percent, to $88.57 billion, Exxon said. A doubling of oil prices since 2003 has put the Irving, Tex.-based company on a pace to surpass Wal-Mart Stores Inc. this year as the largest U.S. company by total revenue.

Profit from worldwide oil and natural gas exploration and production operations jumped 28 percent, to $4.91 billion. Production decreased 4.3 percent, to 3.91 million barrels a day.

The gap between crude oil costs and prices for refined fuels was the widest ever, as consumption rose faster than supplies. Exxon's refining and marketing profit rose 34 percent, to $2.02 billion, mostly outside the United States.

Exxon chief executive Lee R. Raymond is investing in oil and gas fields in Africa and the Middle East as demand grows and output declines from older wells in Europe and North America.

Soaring demand for gasoline, diesel, jet fuel and chemicals helped boost U.S. crude oil futures to a second-quarter average of $53.22 a barrel.

Exxon Mobil and other oil companies may benefit from $2.6 billion in subsidies in the energy bill that is nearing passage in Congress. The subsidies, designed to encourage domestic oil and gas production, were part of an oil industry "wish list," according to David Hamilton, the Sierra Club's energy programs director.

About two-thirds of Exxon's profit comes from oil and gas production.

Royal Dutch Shell PLC, the world's third-largest publicly traded oil company, said yesterday that second-quarter profit rose 34 percent, to $5.24 billion. BP PLC, the second-largest, said on July 26 that profit rose 29 percent, to $5.59 billion.

ConocoPhillips, the third-largest U.S. oil company, said Wednesday that profit rose 51 percent, to $3.14 billion. Chevron Corp., the No. 2 U.S. oil company, is scheduled to announce second-quarter results today.

[registerthis]

Yea, its a little hard raising money to run a company without giving shareholders a benefit. I imagine you volunteer your human resources to your company? You put money in a bank and don't want them to pay interest?Well, let's just say there's offering benefits to shareholders, and there's offering benefits to shareholders.

[traderumor]

Again, reg, don't be misled by real $ increases. The actual bottom lines, after taxes, were flat compared to the prior year. If you just talk % increases using dollars, you realize that if you made $2 this year and only $1 last year, your income just increased 100%. So does that make you rich?

Again, direct your anger at OPEC, not our domestic producers. OPEC are the fat cats making money hand over fist, and have been for years.

[RollyInRaleigh]

I worked in the petroleum business for quite some time. When you think about the way that the prices of other products have inflated over the years, (milk, orange juice, etc.) and then you consider gasoline and the process of refining the crude as compared to the process of getting other products to market, you might realize that the price of gasoline isn't all that bad. Matter of fact, it's been a bargain for a real long time. While I too complain about the recent high prices, compared to other nations, we don't have it that bad when it comes to the price of gasoline. I think the American people feel they are entitled to gasoline at a low price.

FYI, as of this morning, there were nearly 40 gas stations in the Charlotte area without gasoline, and the condition here probably won't get a lot better until after Labor Day. Citizens of the area are being urged not to travel if they don't absolutely have to.

[registerthis]

Again, reg, don't be misled by real $ increases. The actual bottom lines, after taxes, were flat compared to the prior year. If you just talk % increases using dollars, you realize that if you made $2 this year and only $1 last year, your income just increased 100%. So does that make you rich?

Again, direct your anger at OPEC, not our domestic producers. OPEC is the fat cats making money hand over fist, and have been for years.I'm angry at both, TR. OPEC wields a significant amount of power, no doubt. But I'm not misinterpreting the numbers for Exxon. They are poised to surpasse WAL-MART, of all companies. I'm sorry, but when I see things like that, and I see the government handing out $2.6 BILLION in incentives to the oil companies, it boggles my mind.

[registerthis]

I worked in the petroleum business for quite some time. When you think about the way that the prices of other products have inflated over the years, (milk, orange juice, etc.) and then you consider gasoline and the process of refining the crude as compared to the process of getting other products to market, you might realize that the price of gasoline isn't all that bad. Matter of fact, it's been a bargain for a real long time. While I too complain about the recent high prices, compared to other nations, we don't have it that bad when it comes to the price of gasoline. I think the American people feel they are entitled to gasoline at a low price.I don't disagree with this. It's not the prices that gall me nearly as much as the $2.6 billion kickback. I find it borderline infuriating.

[Jeremy Piergallini]

Traderumor,
No I don't volunteer my services. I work in a bank. Dividends paid out are taken from Retained Earnings.

Out of that 2.44 net income per common share, the dividends paid to shareholders was .56 per share. Exxon is currently trading at 61.60 per share.

Buy 10 shares of it. It will cost you 616. DIvidends delclared quarterly would amount to about 12 bucks. Not worth it unless this stock price continues to rise., which looks very likely, then it would be a good investment.

Companies can find other means of finding funds other that gouging its customers. Borrowing funds at low rates is a possibility. They most likely also have investments which provides, depending on the size of their portfolio, good returns.

[Blimpie]

Here's what I don't get (to expound on what sava said), why did the price of gasoline at the pump go up yesterday?

Katrina has caused all kind of problems for all kinds of industries, but you didn't seem that immediately speculated upon and passed onto the consumer. For instance, you could have bought Zatarin's rice mixes for it pre-Katrina prices even though Zatarin's may not be able to produce rice mixes for quite some time. Why? Because the retailer had already paid for it and tacked on its markup.

So why doesn't gasoline follow the same model? After all, your local filling station paid a fixed price for the gasoline it sells you. It didn't suddenly pay more for gasoline between noon and 6 p.m. yesterday. Of course your local filling station doesn't determine its prices. It gets the prices dictated from the corporate level and those prices fluctuate in a manner that adheres neither to logic nor the principle of consumer fairness. That this is legal baffles me.Yesterday, I was told the following by a guy who works at the MAP (Marathon Ashland Petroleum) refinery that is located in Cattlesburg, KY: The rise in yesterday's gas price "at the pumps" was based soley upon speculation by the refineries of impending reduction in their individual allotments of crude. Basically, due to the pipeline disruptions in the Gulf, the refineries were told not to expect any new sizeable shipments of crude in the next few days.

Thus, in anticipation of much a smaller volume of crude to refine, MAP actually began sending some of it's workers home earlier than normal yesterday. MAP corporate office sends word down the distribution chain(s) that retailers should not expect to have their normal daily gas--and more specifically--diesel fuel shipments until later this week.

MAP workers who were sent home early start spreading the word of a "gas shortage" and "gas rationing" at nearby stations, and wham! Everybody rushes to fill up yesterday to get a full tank "ahead of the shortage."

Hello, Supply...I'd like you to meet Demand. Now, gas stations begin to fear that--with all of the rush of fillups--that they have to yield higher margins in a shorter time period in order to cushion the blow during the days when they have no gas or fuel to sell. Those days are especially brutal because that is when they get killed on their residual sales, like: lottery tickets, potato chips, cigarettes and beer. Well, maybe not the latter two items. The demand for those items are pretty much inelastic--but you get my drift.

Nothing about yesterday's gas/fuel spike really seems fair to John Q. Public, but I really don't think the independent gas station owner is really being vindictive or greedy. IMO, we will see a little relief at the pumps...but not until after the holiday weekend is over.

[registerthis]

Nothing about yesterday's gas/fuel spike really seems fair to John Q. Public, but I really don't think the independent gas station owner is really being vindictive or greedy. IMO, we will see a little relief at the pumps...but not until after the holiday weekend is over.No, I htink this is an important distinction. I don't fault the gas staion owners themselves at all--they're simply doing what they can to survive. I fault both the OPEC nations and the mega-oil companies for this current mess that we have.

[traderumor]

I'm angry at both, TR. OPEC wields a significant amount of power, no doubt. But I'm not misinterpreting the numbers for Exxon. They are poised to surpasse WAL-MART, of all companies. I'm sorry, but when I see things like that, and I see the government handing out $2.6 BILLION in incentives to the oil companies, it boggles my mind.And the oil companies can stand on the leg that the incentives will benefit you by enabling more domestic production and less dependence of foreign oil. Where I would hold their feet to the fire is by seeing results, such as higher output (higher percentage of our oil usage being domestice) and lower prices for all products that derive from the industry. If the incentives overall better our economy through lower prices, more jobs, etc., then they are worth it, IMO.

As far as Wal-Mart comparisons, keep in mind that's a comparison of revenues, not the bottom line.

[RollyInRaleigh]

Yesterday, I was told the following by a guy who works at the MAP (Marathon Ashland Petroleum) refinery that is located in Cattlesburg, KY: The rise in yesterday's gas price "at the pumps" was based soley upon speculation by the refineries of impending reduction in their individual allotments of crude. Basically, due to the pipeline disruptions in the Gulf, the refineries were told not to expect any new sizeable shipments of crude in the next few days.

Thus, in anticipation of much a smaller volume of crude to refine, MAP actually began sending some of it's workers home earlier than normal yesterday. MAP corporate office sends word down the distribution chain(s) that retailers should not expect to have their normal daily gas--and more specifically--diesel fuel shipments until later this week.

MAP workers who were sent home early start spreading the word of a "gas shortage" and "gas rationing" at nearby stations, and wham! Everybody rushes to fill up yesterday to get a full tank "ahead of the shortage."

Hello, Supply...I'd like you to meet Demand. Now, gas stations begin to fear that--with all of the rush of fillups--that they have to yield higher margins in a shorter time period in order to cushion the blow during the days when they have no gas or fuel to sell. Those days are especially brutal because that is when they get killed on their residual sales, like: lottery tickets, potato chips, cigarettes and beer. Well, maybe not the latter two items. The demand for those items are pretty much inelastic--but you get my drift.

Nothing about yesterday's gas/fuel spike really seems fair to John Q. Public, but I really don't think the independent gas station owner is really being vindictive or greedy. IMO, we will see a little relief at the pumps...but not until after the holiday weekend is over.

You are right on the money. Most of these station owners aren't making much money on the gasoline sales. They are making pennies on the gallon and the jobbers are not making much either, particularly when the price is going up. They make their money when the price at the terminal starts to drop, and they hold the prices up for a few days to make a little money. The majors are making the bulk of the money on the gas. Where the station owners are hurt is on the sale of the "inside the store" items as you so aptly pointed out. Gas is the draw to get the customer inside the store. Most of the station owners hate the pay at the pump concept, because it keeps people out of the store and the credit card fees eat at what little profit they make on the gasoline.

[Jeremy Piergallini]

They don't need 2.6 billion in incentives. They seem to be doing fine on their own. But since they are getting it, traderumor is right, they better show some return on investment for the government. They better enhance refining, find new ways to make it more cost efficient for all parties involved and find a way to not rely on the Saudi's.

The way I understand it is that we used to get all of the oil from the saudi's. So, if they had 100 million barrells, we would get it at a reasonable price. Well, now, the Chinese need 70 million barrells, you get into a bidding war for the oil.

[RollyInRaleigh]

This may open some eyes and open up the drilling in Alaska and more domestic off-shore drilling. They have the technology to do it without messing up the environment. That argument is very "tired" in my opinion.

[westofyou]

That argument is very "tired" in my opinion.

The past week has been a testament to what happens when you mess with the enviroment.

[registerthis]

And the oil companies can stand on the leg that the incentives will benefit you by enabling more domestic production and less dependence of foreign oil. Where I would hold their feet to the fire is by seeing results, such as higher output (higher percentage of our oil usage being domestice) and lower prices for all products that derive from the industry. If the incentives overall better our economy through lower prices, more jobs, etc., then they are worth it, IMO.I do expect to see a return on this investment...although, again, I don't see WHY they needed it, their profits were more than enough to reinvest into the R&D Bush is proposing.

Regardless of their margin or what have you, any company that rakes in over $7 billion in profit in one quarter--not revenue, PROFIT--doesn't need a government handout. But, like Jeremy said, they gave it to them anyway, so I just hope they spend it wisely. They could start by constructing more refineries...

[RollyInRaleigh]

The past week has been a testament to what happens when you mess with the enviroment.

Explain.

[registerthis]

The past week has been a testament to what happens when you mess with the enviroment.Well, that just proves his point. I'd say the residents of the gulf are very "tired" right about now.

But, hey , who cares if you displace a few seals, right?

Besides, if I am to understand correctly, it is a refinery and distribution issue--not a supply issue--which is driving up costs.

[westofyou]

Explain.

New Orleans was designed without respect to the enviroment of the surrounding area, over the years they moved the river and they levved everything in.

They tried to hold nature back and it failed.

Oil exploraration at all cost to the extent that all of the pristine nature in the world vanishes is a sad price to pay IMO and a lack of respect to the enviroment as a whole interlocking part of the human existance.

[GAC]

Just filled up the Sable - $43.50

I LUV IT!

[westofyou]

Just filled up the Sable - $43.50

I LUV IT!

$36 bucks for my Subaru, it was bone dry. 2 years ago that was a $24 fill up.

[traderumor]

The past week has been a testament to what happens when you mess with the enviroment.I was reading yesterday where the development that greatly diminished the wetlands and greatly contributed to the storm surge damage. I, for one, will think twice before I criticize a "tree hugging" environmentalist again.

[RollyInRaleigh]

New Orleans was designed without respect to the enviroment of the surrounding area, over the years they moved the river and they levved everything in.

They tried to hold nature back and it failed.

Oil exploraration at all cost to the extent that all of the pristine nature in the world vanishes is a sad price to pay IMO and a lack of respect to the enviroment as a whole interlocking part of the human existance.

I don't think anyone is suggesting oil exploration at all cost with "pristine naure" vanishing because of it. The technology is there to do it without destroying the environment, and it should be done only with strict guildelines. At the time, it makes a lot of sense to be less dependent on foreign oil, even if it is more expensive, which I'm beginning to doubt. Cheap Arab oil is a thing of the past.

I don't disagree with you about the way New Orleans was put together. The plan was never good. The bandages finally broke. I just fail to see how it connects with the solid technology that is available now for drilling for our own oil without destroying the environment.

[Blimpie]

I was reading yesterday where the development that greatly diminished the wetlands and greatly contributed to the storm surge damage. I, for one, will think twice before I criticize a "tree hugging" environmentalist again.I think the number being tossed around in some recent wetland mitigation studies was that the NO shoreline was eroding at a clip of around 28,000 acres per year.

[registerthis]

Just filled up the Sable - $43.50

I LUV IT!Gah! :eek:

You drive a Sable???

(Kidding...)

[traderumor]

Gah! :eek:

You drive a Sable???

(Kidding...)Only old people (and Tiger Woods) drive Buicks :p:

[Caveat Emperor]

While I too complain about the recent high prices, compared to other nations, we don't have it that bad when it comes to the price of gasoline. I think the American people feel they are entitled to gasoline at a low price.

The fundamental layout of American society, with residential areas often seperated by great lengths from areas in which people work, make Americans more dependant on gasoline than many foriegn nations.

There is no cheap and effective mass transit system for many people in America, making them totally dependant on their automobiles. We, as a nation, are now reaping what we have NOT sown when it comes to consistent aversion to the initial costs involved for mass transit.

[Heath]

Only old people (and Tiger Woods) drive Buicks :p:

Sable is actually a Mercury.... ;)

I have a Buick...and I'm not old....I think...

[savafan]

While I too complain about the recent high prices, compared to other nations, we don't have it that bad when it comes to the price of gasoline. I think the American people feel they are entitled to gasoline at a low price.



Here's the rub. Sure, Europe has higher gas prices, but they take the profit from those high gas prices and use it to create good public transportation systems. The public transportation systems we have here in the US are largely rundown and inefficient, not to mention you may be risking your life to ride on a bus even in downtown Dayton or Cincinnati. If we had better public transportation systems funded by higher gasoline prices, I'd be all for it, but no, we have billionaire oil men funded by higher gasoline prices and low income public transportation.

Europe also doesn't have the large amount of SUVs that we do (which I see as a huge problem, due to their gas guzzling), although they are getting more popular there.

[WVRedsFan]

I worked in the petroleum business for quite some time. When you think about the way that the prices of other products have inflated over the years, (milk, orange juice, etc.) and then you consider gasoline and the process of refining the crude as compared to the process of getting other products to market, you might realize that the price of gasoline isn't all that bad. Matter of fact, it's been a bargain for a real long time. While I too complain about the recent high prices, compared to other nations, we don't have it that bad when it comes to the price of gasoline. I think the American people feel they are entitled to gasoline at a low price.

FYI, as of this morning, there were nearly 40 gas stations in the Charlotte area without gasoline, and the condition here probably won't get a lot better until after Labor Day. Citizens of the area are being urged not to travel if they don't absolutely have to.

Yep, Randy. No gas in Rainelle--well, very little. No deliveries expected until at least Tuesday and maybe Wednesday. Regular unleaded up to $3.29 and they tell me it will rise $0.10 tomorrow.

I'm sitting still. No travel for me. Barbeque in the backyard and lots of beer. I'll just image what Myrtle Beach looks like this Labor Day...

[savafan]

Hey, I've been hearing for weeks that gas would hit $3.00+ a gallon during the labor day weekend. I'm sure that I'm not the only one who heard that being talked about. Now the oil companies have a patsy named Katrina that they can pin the rise in price on.

[GAC]

$36 bucks for my Subaru, it was bone dry. 2 years ago that was a $24 fill up.

Mine was bone dry too. I was lucky to have made it after picking up the boy at at school.

We're taking the kids up to Cedar Point this weekend. The kids said they want to do their part and help out, and want to use their allowances to pay for the gas.

There is hope for these kids yet. ;)

[GAC]

The past week has been a testament to what happens when you mess with the enviroment.

Not disagreeing totoally with what you are saying woy; but I think the environment just "messed" back with us didn't it? Could that have been controlled other then never settling/developing this coastal region as it has (and well below sea level) and always facing the looming risk of Mother Nature's wrath?

Man, throughout his history, has been able to overcome and co-exist with environmental "roadblocks" and hazards via engineering and design.

But then, I wouldn't advice building a village south of a volcano either. ;)

[GAC]

Gah! :eek:

You drive a Sable???

(Kidding...)

Hey Ben - I currently own two Sables (both paid for). I'm actually on my 3rd. ;)

We bought our first Sable brand new back in '86 and drove it for 17 years, and over 200,000 miles. I'm not one who believes in going out and buying a new car every few years. I don't put much into automobiles like many do. They are simply to get me from point "A" to point "B".

I always make sure the wife and kids have something solid and reliable, while I inherit the "oldies" as work cars. I enjoy living dangerously. :p:

It's also nice not having a car payment.

[Heath]

It's also nice not having a car payment.

I'll second that!

[registerthis]

It's also nice not having a car payment.I will third that.

Although with gas prices now what they are, I feel liek I have two car payments...

God help me, I'm driving from DC to Columbus today. :eek: I just hope there is enough gas to get me there.

[Heath]

I will third that.

Although with gas prices now what they are, I feel liek I have two car payments...

God help me, I'm driving from DC to Columbus today. :eek: I just hope there is enough gas to get me there.

Interesting here in my neck of the woods - the price went from 3.49 overnight to 3.09 :eek:

I think it was "shock" to see what the other stations in the area would have done.

[traderumor]

Sable is actually a Mercury.... ;)

I have a Buick...and I'm not old....I think...Oops.

[smith288]

Its odd...here in Columbus, All I see is 3.09 everywhere...its like it was capped or something...I cant claim I haven't seen every gas station but thats just been my experience.

[registerthis]

Its odd...here in Columbus, All I see is 3.09 everywhere...its like it was capped or something...I cant claim I have seen every gas station but thats just been my experience.Wow, that's more than I paid in DC.

What's up with that? :confused:

[M2]

The fundamental layout of American society, with residential areas often seperated by great lengths from areas in which people work, make Americans more dependant on gasoline than many foriegn nations.

There is no cheap and effective mass transit system for many people in America, making them totally dependant on their automobiles. We, as a nation, are now reaping what we have NOT sown when it comes to consistent aversion to the initial costs involved for mass transit.

True, though Europe did start out with a clustered population model dating back thousands of years around which they could build an effective public transit system. Smaller nations also makes it easier to administer transportation down to the local level.

Our gas dependency also extends to consumer goods. Everything, and I do mean everything, in this country gets to where it ends up by way of a truck. That's why gas prices must stay low. The unit cost of everything skyrockets when gas prices skyrocket. We saw it happen in the late 1970s where exploding gas prices created a bottleneck inflation.

Because gas prices have stayed low, other markets (housing, college tuition, entertainment/sporting events) have been able to boost their prices, always pushing to the front edge of what the market will bear. If we had to pay significantly higher prices for food, household goods and clothing, then those other markets would go into steep decline.