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That's it, I'm walking. gas up 33 cents since Monday, - Page 11

post #301 of 2203
8/31/05 at 11:49am
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That's because they know 10 years down the line they can sell the house and all of a sudden an "obscene profit margin" becomes a "nice return on investment".

Except for those people who lived in extreme markets where 10yrs from now they'll be able to sell and only lose single digit percentages on their "investments"

Andrew
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post #302 of 2203
8/31/05 at 11:59am
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Except for those people who lived in extreme markets where 10yrs from now they'll be able to sell and only lose single digit percentages on their "investments"


Yeah, but I heard a rumor the government has a plan for those "extreme markets". They are going to heavily tax all those new McMansions because anybody who buys a big house has money to spare. Hell, it worked for the U.S. yacht industry.

For those who don't know, in the 80's congress passed an exorbitant tax on new domestic yachts over 50 ft, once a booming U.S. industry. Within one year the industry started to fold because - Surpise! Surprise! - rich people started buying used and foreign yachts. The tax was quietly rescinded, but not before giving a hit to an industry that some say has not recovered to this day.
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post #303 of 2203
8/31/05 at 12:00pm
Save your breath arguing with Ajay, he's consistently for the big corps screwing the little guy:

http://www.hometheaterforum.com/htfo...hreadid=238656
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post #304 of 2203
8/31/05 at 12:02pm
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Save your breath aguing with Ajay


Who said I'm arguing, we mostly agree.
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post #305 of 2203
8/31/05 at 12:02pm
Its quite simple, but people wont put their money where their mouth is. If you think the Oil companies are doing that well right now, sink a ton of money into them. You'll double your money in no time. Then you'll be rich and the price of gas wont phase you. Come on, its easy, just get and Ameritrade account and put all your savings in oil stocks.
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post #306 of 2203
8/31/05 at 12:05pm
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How do you measure growth? Perhaps by increase in sales?


Well of course sales are going up! they're selling almost the same amount of gasoline as before but at higher prices, which means more revenue.

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Depending on who you want to believe the costs for building a new refinery today is going to cost in the double digit billions all the way up to simply impossible (because regulations will simply not be possible to comply with).


I don't believe for a second that regulations prevent the building of new oil refineries. But even if it were so they could lobby the government for a change to those regulations. I can't help but believe that the oil industry could find a sympathetic ear or two in Washington. But again what is their incentive to build new refineries? They are meeting demand at the moment and making money doing so, why would they want to spend money that won't result in increased profits?

As an aside on access to politicians, my father used to run a (relatively) small chemical company. One of their plants was located in Louisiana. He could meet with either LA US Senator with ease, no lobbyists or campaign donations required, all it took was a hundred or so high paying jobs in the state. Now multiply that by a thousand for any one of the big oil companies...
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post #307 of 2203
8/31/05 at 12:06pm
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Save your breath arguing with Ajay, he's consistently for the big corps screwing the little guy:

Hey thanks for the personel attack there instead of actually posting something about the subject. I'm sure you know where the rules are for HTF, perhaps you should read them again and contact a moderator for any part you don't understand.

Then you can come back here and instead of attacking me personally you can actually offer some type of input into the discussion either for or against what I posted, I've admited being wrong in the past, so you are more than welcome to post something that disagree's with what I posted, after all this is a discussion forum, where people discuss things. I apologize in advance if my wanting to post facts and more well thought out discussions offends you, but that's just the way it is, I'm sure you understand.

Andrew
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post #308 of 2203
8/31/05 at 12:09pm
Up to $3.92 locally.

This is the end, my friend...
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post #309 of 2203
8/31/05 at 12:11pm
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Its quite simple, but people wont put their money where their mouth is. If you think the Oil companies are doing that well right now, sink a ton of money into them.

I wouldn't invest now, but 3 years ago was a VERY nice time to get into them

Quote:
Well of course sales are going up! they're selling almost the same amount of gasoline as before but at higher prices, which means more revenue.

Charles, the cost of crude has also gone up. It has gone up a corresponding amount compared to the pumps. When the cost of raw materials goes up, so does the cost to the consumer. So if profits are up, it means you are selling more of your product, not the same amount as before with a higher price.

Quote:
They are meeting demand at the moment and making money doing so, why would they want to spend money that won't result in increased profits?

If they are meeting demand, how can spending the money on building more capacity end up lowering prices?

Andrew
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post #310 of 2203
8/31/05 at 12:14pm
I like when people type "pro-corporation" responses. It's real easy for us all to cry about these companies trying to "screw" us, when you damn well know we'd be doing the EXACT same thing if we were in their position...and please don't give me the "I'd be fair" routine, becuase it just ain't true.

Also, I think too many people quickly fall victim of the "conspiracy" theory where they think everyone is "out to get you" PLEASE!

If you want 'charity' - talk about the Red Cross, otherwise, don't expect a corporation to be 'charitable' because it'll cause that vein in your head to explode
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post #311 of 2203
8/31/05 at 12:15pm
f**k me ... just got back from my lunch run ... went to fill-up as well. streets are oddly void of traffic here in the boroughs of NYC.

oh yeah ... could be the huge gas increase literally overnight ... the station i go to: 2.95 regular / 3.05 super

not even a mile down the road ... 3.15 regular / 3.35 super

This is pure gouging at this point
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post #312 of 2203
8/31/05 at 12:20pm
Bah! I just want an alternative fuel and leave the oil corporations holding their dicks.

- Colton
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post #313 of 2203
8/31/05 at 12:21pm
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This is pure gouging at this point
I doubt it. The local radio station in Omaha was talking to gas station owners this morning and they said they were paying basically $3 a gallon for their most recent tanks full. That means that the profit margin at the station is the same as it was when it was $2.59 a couple weeks ago.
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post #314 of 2203
8/31/05 at 12:23pm
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If they are meeting demand, how can spending the money on building more capacity end up lowering prices?


I don't know. I never said it would. Someone else on the thread asserted that building new refineries would reduce the cost of gasoline at the pump. I'm saying that if that is so, then there is no incentive for the oil companies to build new refineries.

Quote:
So if profits are up, it means you are selling more of your product, not the same amount as before with a higher price.


So you're saying they're selling more gasoline even though the price is going up?
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post #315 of 2203
8/31/05 at 12:32pm
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I'm saying that if that is so, then there is no incentive for the oil companies to build new refineries.

I've never once heard of a business case where stifling demand (in this case by not building more capacity) leads to higher profits for a business such as gas (obviously keeping high demand is important for something like high end jewelry), especially if it's "easy" to build that extra capacity.

Quote:
So you're saying they're selling more gasoline even though the price is going up?

Yes, demand is up. Demand is also going way up in places like China and India, which is driving up the cost of crude.
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post #316 of 2203
8/31/05 at 12:36pm
The Oil Companies are passing the entire increase in the barrel of oil directly to their end consumers, whether they be the public or independent station operators.

Prices need to be frozen and a MASSIVE LIFETIME TAX CREDIT should be given to the person/company who invents an engine that can perform as well or better than our best vehicles but will run on a cheap and completely renewable energy source.
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post #317 of 2203
8/31/05 at 12:39pm
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I doubt it. The local radio station in Omaha was talking to gas station owners this morning and they said they were paying basically $3 a gallon for their most recent tanks full. That means that the profit margin at the station is the same as it was when it was $2.59 a couple weeks ago.
I don't think that means there is no gouging, I think it just means the gouging is coming from higher up, not from local retailers.
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post #318 of 2203
8/31/05 at 12:40pm
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Bah! I just want an alternative fuel and leave the oil corporations holding their dicks.


You mention Hydrogen, I dare you!!!
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post #319 of 2203
8/31/05 at 12:40pm
they don't have to sell more gasoline for it to be worth raising the price.

If they raise the price, their sales go down but their profit per sale goes up. Their costs also go down as it costs money to buy and ship gas. If the savings from lower costs and the increase in profit per unit outstrips the loss in sales. It make good economic sense to put the price up.
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post #320 of 2203
8/31/05 at 12:45pm
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I've never once heard of a business case where stifling demand (in this case by not building more capacity)


How is not building new oil refineries stifling demand? Its not like construction of a new refinery is going to make people drive more. ("Oh a new refinery in Louisiana I think I'll drive cross country to look at it!")

If the prime reason for the increase in price is the cost of raw materials, using more raw material to produce more product won't reduce the price.
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post #321 of 2203
8/31/05 at 12:47pm
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Prices need to be frozen


You think prices are high now for the cost of driving to work? Think of what you will do if you can't drive because there is no gas. That's right, no gas. How upset would you be if your tank is empty, you wait in line for 2-3 hours and when you get to the pump (if they have any gas left) you are told you can only fill up on Monday, Wednesday or Friday because the first number on your license plate is a '2'?

Don't think it will happen? Well it has. I've lived it, it is not pretty.
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post #322 of 2203
8/31/05 at 12:53pm
Gas at the BP station at the corner of 60th and Kalamazoo here in G.R. is at $3.19 for unleaded.

According to my mom who lives in Muskegon, gas is at $3.48 there. Yikes!

According to detroitgasprices.com, a Marathon station at the corner of Middlebelt and Ford in Garden City was selling it for $3.92.
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post #323 of 2203
8/31/05 at 12:53pm
Guys until you can reduce the cost of crude, you're not going to lower the price of gas;

Let's look at some prices here;
Jan 1 - 2001
Crude = $27.29
Gas Price = $.77

Aug 23 - 2005
Crude = $65.81
Gas Price = $1.83

You're more than welcome to figure out the percentages in terms of increase, but you're going to be suprised by the numbers you come up with.

Quote:
How is not building new oil refineries stifling demand?

Errr I meant supply, or to expand it out there are some people who think they aren't building new refineries/operating old refineries to artificially stifle the supply, hence keeping the demand high. We're not talking Ferrari's and Rolex's here, where they build a very low number of them to keep demand high.

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If the prime reason for the increase in price is the cost of raw materials, using more raw material to produce more product won't reduce the price.

Right, the only way to lower the price is to increase demand (hence profits are made from volume), or to lower the costs to bring the product to market.
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post #324 of 2203
8/31/05 at 12:57pm
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I've never once heard of a business case where stifling demand (in this case by not building more capacity) leads to higher profits for a business such as gas (obviously keeping high demand is important for something like high end jewelry), especially if it's "easy" to build that extra capacity.

Didn't OPEC used to do this? I am assuming when you say "stifling demand" you mean not meeting the demand? Hmmm, now I'm a little confused. On the other hand, OPEC doesn't make gas, just oil, so I guess this is different...

What is OPEC doing now anyways? Are they planning to increase production to keep the price lower (or stable) or are they already at maximum production?
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post #325 of 2203
8/31/05 at 1:00pm
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it is not pretty

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post #326 of 2203
8/31/05 at 1:09pm
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What is OPEC doing now anyways? Are they planning to increase production to keep the price lower (or stable) or are they already at maximum production?


They claim to be at max (or near max) production. But you can't tell me some of these Middle East countries aren't rolling on the floor, laughing their asses off at what this is doing to our economy. This is the sole reason they formed OPEC - to punish the US for supporting Israel.

I'd bet they could pump a hell of a lot more than they are.
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post #327 of 2203
8/31/05 at 1:12pm
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What is OPEC doing now anyways? Are they planning to increase production to keep the price lower (or stable) or are they already at maximum production?


OPEC has become less relevant because they control a smaller percentage of the world supply of oil than they did during the 70s, also their members routinely cheat when they try to reduce supply to increase the price.

As far as how much excess production capacity they have its anyone's guess. Legendry oil tycoon T. Boone Pickens thinks that the Saudis for instance are maxed out and that "peak oil" is upon us. (Peak oil being that supply is unable to keep up with demand, not that the total amount of oil pumped is decreasing.) Others think there is still excess capacity and peak oil is still at least decades away (note that production capacity is not the same as reserves, they may still be sitting on a ton of oil, but it is not as easy as one might imagine to pump it out faster).
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post #328 of 2203
8/31/05 at 1:13pm
Apparently, you can get gas for $.12/gal in Caracas, Venezuela and $.68 in Kuwait City.

http://money.cnn.com/2005/08/31/news...ex.htm?cnn=yes
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post #329 of 2203
8/31/05 at 1:16pm
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Apparently, you can get gas for $.12/gal in Caracas, Venezuela and $.68 in Kuwait City.

That's a hell of a commute for just cheap gas

Andrew
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post #330 of 2203
8/31/05 at 1:16pm
Quote:
the only way to lower the price is to increase demand (hence profits are made from volume),


If the supply stays the same and demand goes up, prices go up.
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