knobbie mefo

[Oldrice]

Want real data to explain all this oil crap? It's soooooo simple. What are the three BIGGEST oil companies? - check them out. What were they're best years - PROFIT? - the last three. Check them out. WHY are these companies making record profits IF the cost to them has increased? It hasn't. They're still getting oil at nearly $20 a barrel. Remember, you and I don't use oil from the Middle East. Ours is from South America where they aren't even a member of OPEC. Ok, the vast majority of our gas in our KLRs is from Columbia. The rest is from a multitude of places. But you get my point. They're literally taking our money. Think about it. Geoff- www.oldrice.com

----- Original Message ----- From: "Don S" Subject: Re: [DSN_KLR650] NKLR: Re: Eco Friendly nature of Hybrid Cars Hi Bogdan: I used exaggerted figures to make a point. That point is that the cost of gasoline per gallon is not proportionate to the relative increase in the oil price. Does the price of processing the oil into gasoline increase because the oil became more expensive? Have you ever wondered why the price of gasoline goes up just before the weekend and particularly on holidays with long weekends then drops within a day or two afterward? Big Oil sticks it to us more so than the oil producing countries. Please don't try to pass it off as supply and demand. Unless of course you believe that the refineries doubled up on capacity (and operating costs) during said weekend to make up for difference then sell it cheaper because they have too much supply? One does not need any particular qualifications other than common sense to observe the obvious. Don S. Bogdan Swider wrote: On 5/17/06 2:16 PM, "Don S" wrote: > I find it ironic that we point fingers at the oil producing countries > whenever > the cost of oil goes up by one cent per barrel and the cost of gas goes up > $1.00 per gallon at the same time! I'm no economist, I'm ignorant of the corporate culture in the energy sector and don't follow oil futures but didn't oil go from around $40 a barrel to $70 ? That's not a cent or am I missing something ? Bogdan Archive Quicksearch at: http://www.angelfire.com/ut/moab/klr650_data_search.html List sponsored by Dual Sport News at: www.dualsportnews.com List FAQ courtesy of Chris Krok at: www.bigcee.com/klr650faq.html Member Map at: http://www.frappr.com/dsnklr650 Yahoo! Groups Links --------------------------------- Yahoo! Messenger with Voice. Make PC-to-Phone Calls to the US (and 30+ countries) for 2 /min or less. [Non-text portions of this message have been removed] Archive Quicksearch at: http://www.angelfire.com/ut/moab/klr650_data_search.html List sponsored by Dual Sport News at: www.dualsportnews.com List FAQ courtesy of Chris Krok at: www.bigcee.com/klr650faq.html Member Map at: http://www.frappr.com/dsnklr650 Yahoo! Groups Links

[E.L. Green]

--- In DSN_KLR650@yahoogroups.com, "Oldrice" wrote:

> > Want real data to explain all this oil crap? It's soooooo simple. > > What are the three BIGGEST oil companies? - check them out. > > What were they're best years - PROFIT? - the last three. Check them

out.

> > WHY are these companies making record profits IF the cost to them has > increased?

I gave you the real numbers earlier, taken from U.S. government sources but which match my "seat of the pants" observations for those periods. The price of gasoline has gone up by a smaller percentage than the price of the underlying crude since its last historic low in December 2001. Refiners are making more profit because 4.5% of $2.25 is more money than 5% of $0.67, not because they have a higher profit margin. Oil companies are making more money because they are selling barrels of crude for more because that's what the market will bear, not because they want to make our gasoline more expensive. If you want lower gasoline prices, we need to figure out how to use less oil, or find or create more oil somehow. Given that most of our oil comes from overseas and thus we have no way of imposing some sort of artificial per-barrel limit on its price (other than by invading their countries, killing their leaders, and imposing a global empire at gunpoint), we have to depend on the free market here -- and the free market says that the price of oil is going up, up, up with no limit in sight. -E

[jokerloco9@aol.com]

I'm no expert either, but I think a barrel of oil is about 42 gallons. Not all is gasoline. So you get much less than 42 gallons of gasoline for $70. Now add shipping and refining costs. The wholesale cost of gas now is about 2.15 a gallon. By the way, I believe oil was about $28 a barrel a couple of years ago. So it has about tripled. Blame the price increase on increased world demand, mainly China. Our president has little or nothing to do with it. I suspect the majority of the windfall profits being made by the oil companies is due to the prices go up quickly (the same day) that oil prices go up, but take weeks to fall as prices go down. Everyone gets the profit difference on the gas they bought at the lower price, and sell at the higher price. Kind of like any store that raises prices because their costs go up. But what about the stock on the shelves, that was bought at the lower price? They sell it at the higher price! Jeff A20 [Non-text portions of this message have been removed]

[Stuart Mumford]

> -----Original Message----- > > --- In DSN_KLR650@yahoogroups.com, "Oldrice" wrote: > > > > Want real data to explain all this oil crap? It's soooooo simple. > > > > What are the three BIGGEST oil companies? - check them out. > > > > What were they're best years - PROFIT? - the last three. Check them > out. > > > > WHY are these companies making record profits IF the cost to them has > > increased? >

Volume, volume, volume. If you make 8% profit and sell $5 billion, your profit is more than if you make 10% profit and sell $3 billion. Math is hard. Thanks CA Stu PS Big Oil companies are publicly owned. If you want a piece of the pie, buy some stock in them.

[jokerloco9@aol.com]

Um, well, actually, it is supply and demand affecting prices on weekends and wekdays. This is the capatilist system. Perhaps you can name any large profitable business that isn't trying to find the best marginal return for their poduct? This particular industry works on a weekly basis. Do you cry about how airlines do their pricing? If you know that gas prices are higher on weekends, then why not fill up during the week? Do you cry when a dealer marks up the price of a popular car? I could sit here for a week and give examples, but I'm not going to waste my time. The problem is Americans that think they have a right to unlimited cheap energy. We did not learn anything from the oil embargos of the 1970's. We still drive gas guzzling boats getting 10- 18 mpg. We need smaller, perhaps 2 person 1000-1500 lb commuter vehicles, maybe with diesel engines, plus more alternative fuel vehicles and new technology, such as hydrogen fuel cells. With cheap oil, they won't be developed very quickly, if at all. Personally, I hope gas goes up to $4.00 a gallon, and stays there at least a year. That is the only way new technologies will be developed, and Americans change there attitudes. The only thing Americans understand is money. And yes, I am dead serious about that. And no, I am not a liberal tree hugger. I'm as right wing as they come, living in Los Angeles, CA Jeff A20 [Non-text portions of this message have been removed]

[jokerloco9@aol.com]

Yo, dude....... we would not be buying oil at $70 a barrel if we could get it for $20. Duh! Jeff A20 [Non-text portions of this message have been removed]

[jokerloco9@aol.com]

I agree with some of your math. Yes, the cost of a barrel of oil is higher (actually about $72 a barrel, not $62). But your gas price going up that 3.86 multiple is assuming ALL costs associated with oil have gone up 3.86 times. transportation and refining costs have not gone up 3.86 times. Jeff A20 [Non-text portions of this message have been removed]

[jokerloco9@aol.com]

Fine. So what if they make money. The more the merrier. Let more oil companies form, to increase competition! Jeff A20 [Non-text portions of this message have been removed]

[Randy Shultz]

--- In DSN_KLR650@yahoogroups.com, jokerloco9@... wrote:

> > I agree with some of your math. Yes, the cost of a barrel of oil is

higher

> (actually about $72 a barrel, not $62). But your gas price going up

that

> 3.86 multiple is assuming ALL costs associated with oil have gone up

3.86 times.

> > transportation and refining costs have not gone up 3.86 times. >

--- I don't know what the break-out is today, but two years ago the cost of oil made up about 50% of the cost of gasoline. About 18% was refining costs, including their profit margin, and almost 25% was taxes, the rest being marketing and distribution. Keep in mind that only about 50% of a typical barrel of crude winds up as gasoline.

[Spike55]

Without getting in too deep, a barrel of anything is 42 gallons (US) and is the basis for a futures contract on the New York Merchantile Exchange (NYMEX). Each futures contract is for 1,000 barrels or 42,000 gallons of product. Heating oil, unleaded gasoline, light sweet crude oil, and propane are all based on that volume but their advertised prices are given differently: $70 / barrel for light sweet crude, $1.90 / gallon for heating oil, unleaded gasoline , and/or propane. The natual gas futures contract is based on 10,000 millon british thermal units (BTU's), which is normally written 1 MMBTU (roman numeral M = 1000 so MM is 1000 x 1000 = 1,000,000). The advertised NYMEX prices is say $6.50 MMBTU's right now. (Our Canadian brothers and sisters have to deal with giga-joules but again, I'm not going there.) As late as 1998 / 1999, the price per barrel of light sweet crude oil was down as low as $9.00 (US). This occured when the Pacific Rim countries were suffering a huge economic downturn and in turn, they were not using much oil at all. Oil, like natural gas, like milk out of a cow comes out at about the same rate all of the time whether you needed it or not. This is an example of inelastic supply - can't throttle it up or down easily. Depending how closely your demand corresponds (exceeds or falls below) to that flow of product, prices will fluctuate to move the product. It is ever increasingly apparent that demand for gasoline (energy in general) is becoming inelastic too (inelastic demand). It seems as we have become spread out in suburbia and frequently travel longer distances for work and play, no matter what the price, we are going to pay it. Many industries and electric utilities are the same way and will pay the price and then past that on to the customer through a fuel adjustment surcharge (based on such and such a benchmark). If you believe we have plenty of crude oil is available to come into the USA and that the lack of refinery capacity is the bottleneck, then please be aware that it isn't NIMBY, or environmentalist that is 100% of the problem. Who in their right mind would build another multi-million dollar refinery (assume all of that debt - even if you were rich) to compete against your existing plant(s) or those of your buddies (other oil companies) in an oligopoly situation (almost the same a a monopoly but with more players), in which you are running at maximum effiency, lowest operating cost, selling every ounce you make, at the highest prices in decades (relatively and literally)? There is no incentive for any changes in the infrastructure because the oil companies have seen it come down as hard as it goes up so they are going to sit on what they have (wells, pipelines, refineries, distribution, etc.) for now and repair only what gets broken. Again, we run our bikes like this. They are doing the same thing on a grand scale. My 2 cents. Don R100, A6F

--- In DSN_KLR650@yahoogroups.com, jokerloco9@... wrote: > > I'm no expert either, but I think a barrel of oil is about 42 gallons. Not > all is gasoline. So you get much less than 42 gallons of gasoline for $70. > Now add shipping and refining costs. The wholesale cost of gas now is about > 2.15 a gallon. > > By the way, I believe oil was about $28 a barrel a couple of years ago. So > it has about tripled. Blame the price increase on increased world demand, > mainly China. Our president has little or nothing to do with it. > > I suspect the majority of the windfall profits being made by the oil > companies is due to the prices go up quickly (the same day) that oil prices go up, > but take weeks to fall as prices go down. Everyone gets the profit difference > on the gas they bought at the lower price, and sell at the higher price. > Kind of like any store that raises prices because their costs go up. But what > about the stock on the shelves, that was bought at the lower price? They > sell it at the higher price! > > Jeff A20 > > > [Non-text portions of this message have been removed] >