Cheveron posts record profit...
#46
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Originally Posted by shortbus
Want to buy a bridge? Seriously, I've got one to sell you cheap...
It has nothing to do with supply. It has to do with the fact that they can charge whatever they want and we'll pay it. As a libertarian and believer in a free market I'm all for that. What I do have a problem with is the amount of tax we pay per gallon.
I've also got a problem with being lied to. "We've got to raise prices because of Katrina" and "we're just passing our costs on to the consumer" then posts record profits. I'd fell much better if they'd just come out and say, we're fixin to give it to ya good, no lube, no reach around. Now bend over.
It has nothing to do with supply. It has to do with the fact that they can charge whatever they want and we'll pay it. As a libertarian and believer in a free market I'm all for that. What I do have a problem with is the amount of tax we pay per gallon.
I've also got a problem with being lied to. "We've got to raise prices because of Katrina" and "we're just passing our costs on to the consumer" then posts record profits. I'd fell much better if they'd just come out and say, we're fixin to give it to ya good, no lube, no reach around. Now bend over.
I could make "record profits" off of Teddy bears, even if profit margin was <10%, IF demand was a record highs...
I wish everyone would quit ignorantly complaining about the high prices we have today and realize that the higher prices now go a long way towards preempting TERRIBLE prices now.
What's worse, a couple months of $3/gal now, or a couple months of $5/gal next summer??
*IF* what you say is true-- that they can charge whatever they want, then why aren't we paying $4/gallon? $5? Heck, $12???
Fact is, they can't charge whatever they want. Market forces, duh.
But this inconvenient fact disposes of the myth that there is a big price gouging conspiracy, so I can see why people chose to ignore it.
jh
#47
Originally Posted by HOHN
ENOUGH! Enough of the "record profits" mantra! Why isn't anyone talking about "record consumption"?
Consumption is down 0.4% in the US from the same time last year. This is reported by the oil companies themselves. Granted, it isn't much, but is still DOWN!!!
Originally Posted by HOHN
What's worse, a couple months of $3/gal now, or a couple months of $5/gal next summer??
Originally Posted by HOHN
But this inconvenient fact disposes of the myth that there is a big price gouging conspiracy, so I can see why people chose to ignore it.
jh
jh
The number of rigs in production, the amount of crude being pumped, and the prices being charged do not sync up. The commodities market is making most or all of it's 'speculation' on 'what if Iran stops selling oil' or 'what if they attack the tankers leaving the gulf'. This is the same speculation that was going on during the 80's when Iran threatened to do the exact same thing. Historical price indexes (available to anyone who wants to look) show that prices for crude DECLINED during this time, and in fact were near an all time low.
And the increased world consumption argument is a 'bit' (not totally, but a little) weak in that OPEC has increased production each year.
Currently the absolute limiting factor on Gas/Diesel/Kerosene/Heating oil in this country is refineries. The refineries we have can only produce a finite amount. So, by using the 'supply/demand' argument, the oil companies charge more because the 'supply' is low. OK, I'll buy that. But the problem is, they are speculatively increasing the price of crude on the FRONT end of the supply chain.
And to be honest with you, I find it slightly funny that the loudest people around here defending the prices that are being charged are those that work in the oil industries, not the economists in the group. Hmm.....
#48
Registered User
Forget math when speculations and emotions are involve. The commodities market is being driven up now just like the stock market did back in the '90s. People figured it's easier to make a buck in the commodities trade now than in the stock market. Look at the price of gold and other metals.
MikeyB
MikeyB
#49
Registered User
Originally Posted by shortbus
Want to buy a bridge? Seriously, I've got one to sell you cheap...
It has nothing to do with supply. It has to do with the fact that they can charge whatever they want and we'll pay it. As a libertarian and believer in a free market I'm all for that. What I do have a problem with is the amount of tax we pay per gallon.
I've also got a problem with being lied to. "We've got to raise prices because of Katrina" and "we're just passing our costs on to the consumer" then posts record profits. I'd fell much better if they'd just come out and say, we're fixin to give it to ya good, no lube, no reach around. Now bend over.
It has nothing to do with supply. It has to do with the fact that they can charge whatever they want and we'll pay it. As a libertarian and believer in a free market I'm all for that. What I do have a problem with is the amount of tax we pay per gallon.
I've also got a problem with being lied to. "We've got to raise prices because of Katrina" and "we're just passing our costs on to the consumer" then posts record profits. I'd fell much better if they'd just come out and say, we're fixin to give it to ya good, no lube, no reach around. Now bend over.
Edwin
#50
Originally Posted by edwinsmith
We are mostly used to being lied to so much that we no longer have the reasoning power to determine what is true and what is BS. I just read a great article on Lew Rockwell about the true price of gasoline in relation to the price of gold. Basically at the current price of gasoline Vs. gold gas is about 10 cents a gallon.
Edwin
Edwin
#51
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Originally Posted by Stingerpup
ANNNHHH!! Thanks for playing, next contestant!!!
Consumption is down 0.4% in the US from the same time last year. This is reported by the oil companies themselves. Granted, it isn't much, but is still DOWN!!!
Consumption is down 0.4% in the US from the same time last year. This is reported by the oil companies themselves. Granted, it isn't much, but is still DOWN!!!
As I posted on the 'Prices' thread, it isn't a conspiracy at all. It is flat out theft. Use your fingers and your calculator and do simple math.
The number of rigs in production, the amount of crude being pumped, and the prices being charged do not sync up. The commodities market is making most or all of it's 'speculation' on 'what if Iran stops selling oil' or 'what if they attack the tankers leaving the gulf'. This is the same speculation that was going on during the 80's when Iran threatened to do the exact same thing. Historical price indexes (available to anyone who wants to look) show that prices for crude DECLINED during this time, and in fact were near an all time low.
And the increased world consumption argument is a 'bit' (not totally, but a little) weak in that OPEC has increased production each year.
Currently the absolute limiting factor on Gas/Diesel/Kerosene/Heating oil in this country is refineries. The refineries we have can only produce a finite amount. So, by using the 'supply/demand' argument, the oil companies charge more because the 'supply' is low. OK, I'll buy that. But the problem is, they are speculatively increasing the price of crude on the FRONT end of the supply chain.
And to be honest with you, I find it slightly funny that the loudest people around here defending the prices that are being charged are those that work in the oil industries, not the economists in the group. Hmm.....
It's NOT theft. Theft is one someone takes something from you and you get nothing in return. I know-- an expert like you already knows that, right?
It *IS* just supply and demand. Speculation is for sure a big part of that demand, though-- as it ALWAYS is.
So we have the confluence of many factors:
1) The devaluation of the US Dollar, which is the denominating currency for the global oil market
2) The lack of refinery capacity in the US
3) All-time high levels of global oil demand (thanks to China and India developing)
4) Fear-driven speculation due to the political climate of the most oil-wealthy nations
I've said it before and I'll say it again-- there is NO GOUGING at profit margins under 10%, no matter how much a person moans, whines, and complains.
Oh, never mind! I was ALL WRONG! Turns out there's a 29th Amendment:
"A gas-guzzling SUV being part of true Liberty, the Right of the People to always have gasoline under $2 shall not be infringed"
So do ALL of us a favor. Educate yourself on basic economics, THEN come back in here and rant and rave when you have some credibility.
For now, I suggest you start by Googling "tulip bulb craze", and spend some quality letting Wikipedia give you what your local school obviously did NOT.
#52
Originally Posted by HOHN
Oh, never mind! I was ALL WRONG! Turns out there's a 29th Amendment:
"A gas-guzzling SUV being part of true Liberty, the Right of the People to always have gasoline under $2 shall not be infringed"
"A gas-guzzling SUV being part of true Liberty, the Right of the People to always have gasoline under $2 shall not be infringed"
Originally Posted by HOHN
So do ALL of us a favor. Educate yourself on basic economics, THEN come back in here and rant and rave when you have some credibility.
Originally Posted by HOHN
For now, I suggest you start by Googling "tulip bulb craze", and spend some quality letting Wikipedia give you what your local school obviously did NOT.
And I would agree with you, that a 10% profit is nothing to yell 'foul' about. But a 400% increase is a bit of a different situation, wouldn't you agree?
I've tried to present my points in a concise, logical and unemotional manner (ok, I did slip once with the "ANNNHHH" thing, sorry about that) with numbers and figures available to anyone who wants to look for them. And you have turned it into an argument filled with rhetoric and personal attacks. Sorry you felt you had to go that way.
In closing...
So we have the confluence of many factors:
1) The devaluation of the US Dollar, which is the denominating currency for the global oil market
Agreed, the devalution has an effect. But the dollar hasn't devalued to the level that is being expressed by the cost of fuel being charged at the pump. We are talking about a 20% increase in the cost in the past few weeks, has the devaluation even approached that?? I looked and it was under 5% overall.
2) The lack of refinery capacity in the US
Yes, we agree there.
3) All-time high levels of global oil demand (thanks to China and India developing)
I partially agree there, but again I point out that OPEC and the other oil producing countries outside that organization have increased production to offset this.
4) Fear-driven speculation due to the political climate of the most oil-wealthy nations
I agree with you on what is driving this speculation, but I don't agree on the validity of it. That is the point I was trying to make with my data concerning Iran's previous threats. And this is currently the political climate in ONE 'oil-wealthy' nation, not all. If the current instability in that region was that detrimental, oil prices wouldn't have decreased as much as they did during/after the Iran/Iraq war.
This is my last entry in this thread, because it is safe to say that we will never agree on this topic and I don't appreciate the attacks.
Have a nice day.
#53
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My mea culpa:
The attacks are because of my own foolish pride thinking it's my place to knock down a few notches someone who comes across as arrogant. Yet, as an emperor I have no clothes! The "annnhhh" thing is what got me all riled up:x
My apologies-- I was out of line and I knew it before I posted but wasn't man enough to refrain from the attacks anyway. Rather than edit and delete, I'll leave it up to hold myself accountable for the misdeed. The mods are welcome to edit as they see fit, since it may reflect poorly on the DTR.
Anyway......
As regards Pt #3--
-- If OPEC has increased production to offset the increased demand of India and China, then why has wholesale crude pricing gone up so far? If they are keeping up with demand, shouldn't the price of crude stay constant?
As for speculation, you know the old adage about how the markets hate uncertainty...
The attacks are because of my own foolish pride thinking it's my place to knock down a few notches someone who comes across as arrogant. Yet, as an emperor I have no clothes! The "annnhhh" thing is what got me all riled up:x
My apologies-- I was out of line and I knew it before I posted but wasn't man enough to refrain from the attacks anyway. Rather than edit and delete, I'll leave it up to hold myself accountable for the misdeed. The mods are welcome to edit as they see fit, since it may reflect poorly on the DTR.
Anyway......
As regards Pt #3--
-- If OPEC has increased production to offset the increased demand of India and China, then why has wholesale crude pricing gone up so far? If they are keeping up with demand, shouldn't the price of crude stay constant?
As for speculation, you know the old adage about how the markets hate uncertainty...
#54
Registered User
My understanding is that China is filling a petroleum reserve much like the one the US has as fast as they can.
Doesn't this factor into supply almost equalling demand?
Doesn't this factor into supply almost equalling demand?
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