Gas prices at the pump

[JeffreyLebowski]

Originally posted by: BriGy86
how much does a quart of oil cost for your car these days?

and how much did it cost a year ago or 2 years ago?

doesn't that oil come from the same place as the oil that's refined and made into gas comes from?

that's something to think about

Ha, I've been saying the same damned thing. A quart of motor oil cost the same if maybe at the most $.03 more than 2 years ago. If the cost of OIL is really going up, why isn't OIL more expensive.

 

[Specop 007]

Originally posted by: shoRunner

Originally posted by: tallest1

Bush unveils steps to counter high oil prices
"President George W. Bush on Tuesday gave U.S. refiners extra time to pay back emergency oil loans, and called on the government to find ways to ease new clean-burning gasoline regulations.

In a speech to the pro-ethanol Renewable Fuels Association, Bush said the U.S. Congress should find a way to approve permits to build new refineries a year after they are filed.

Bush said he told the Environmental Protection Agency to use "all available authority to grant waivers that would relieve critical fuel shortages," and said he would seek more waiver authority from Congress if needed."

OMFG, why are corporate handouts the solution to everything for this guy???

Reuters Link

what is the solution? do tell pls

He doesnt have one. The Liberal Koolaid doesnt provide answers, just complaints.

 

[desy]

Because a barrel of oil is split into different components its not like you can take a barrel and make it all gas or all jetfuel or all heating oil.
Demand for any particular component of it will drive up the price of the whole.
So the refining company gets a much better price on wholesale rack price for gasoline but now he has a surplus of motor oil because the demand for each product isn't linear so he can keep the price of motor oil down.

 

[gsethi]

Originally posted by: JeffreyLebowski

Originally posted by: BriGy86
how much does a quart of oil cost for your car these days?

and how much did it cost a year ago or 2 years ago?

doesn't that oil come from the same place as the oil that's refined and made into gas comes from?

that's something to think about

Ha, I've been saying the same damned thing. A quart of motor oil cost the same if maybe at the most $.03 more than 2 years ago. If the cost of OIL is really going up, why isn't OIL more expensive.

b/c there is more profit to be made in Gas than Oil. You can choose not to have your oil changed (or change is less frequent) but you "HAVE" to get gas.

Gas stations will raise the price when they order their next delivery and that next order is at the higher price. (same thing happens when they lower prices - although when lowering prices, they make few extra pennies as they will not lower to the actual reduced price).

Its called Business...they are there to make $$$ also.

 

[b0mbrman]

Originally posted by: Tom
They can charge whatever they want, don't buy it if it's too high.

Exactly.

Why is gas one of a few consumer goods that Americans feel the supplier has a moral obligation to provide us with a cheap price for?

 

[racolvin]

Because, unfortunately, it is to the point where gasoline is a necessity, not a luxury. Whether I choose to go out to dinner or have a tuna sandwhich at home, or perhaps whether to buy that new computer game or not, can be based on price and market conditions. But, with few exceptions, I MUST have gasoline in order to generate income. If mass transit were the norm everywhere in America that might not be as big of a deal but it simply isn't the case. To get to my clients, I must drive my vehicle. To get to healthcare facilties, food sources, etc, I must drive and consume gasoline. I can certainly take steps to mitigate my consumption, in driving habits, vehicle maintenance, and even choice of vehicle, but ultimately I will still need gasoline.

All that rant is to say that gasoline isn't just a regular consumer good like any other that can happily ride the market ups and downs. I have no problem paying for gas and I have no problem recognizing that as raw materials costs rise so do the end product. That being said, the way the price rise, the frequency of change, and the percentage of profit from a good that I MUST have should be subject to more scrutiny than a Subway sandwich. Numerous other industries have their pricing and profits regulated, so why not gasoline?

If gas were something I could "take it or leave it", then I would be much more inclined to support a total free-market approach to its pricing. Since that's not an option, it needs to be treated differently.

 

[Queasy]

Originally posted by: racolvin
If gas were something I could "take it or leave it", then I would be much more inclined to support a total free-market approach to its pricing. Since that's not an option, it needs to be treated differently.

That's all well and good but it has already been shown that government control of prices results in shortages (Carter - 70s).

 

[racolvin]

Oh I'm not saying I have an answer. Carter tried to fix the price at the pump and that was never going to work. But, it IS possible to control the percentage of profit allowed. Costs can fluctuate and the final price would follow, but if the profit percentage allowed was fixed, at least that would be something.

And its not as if the fixed-profit percentage is unheard of or would drive out the players. Ever been a Defense Dept. contractor? Their profit percentages are fixed, costs are tracked and audited and there are still players on that field. It's not that the company shouldn't make money, its just that they shouldn't make so MUCH money on a necessity. You know a company is raking in more than their fair share when they can give their retiring exec a $400 million retirement payout.

 

[Queasy]

Originally posted by: racolvin
Oh I'm not saying I have an answer. Carter tried to fix the price at the pump and that was never going to work. But, it IS possible to control the percentage of profit allowed. Costs can fluctuate and the final price would follow, but if the profit percentage allowed was fixed, at least that would be something.

And its not as if the fixed-profit percentage is unheard of or would drive out the players. Ever been a Defense Dept. contractor? Their profit percentages are fixed, costs are tracked and audited and there are still players on that field. It's not that the company shouldn't make money, its just that they shouldn't make so MUCH money on a necessity. You know a company is raking in more than their fair share when they can give their retiring exec a $400 million retirement payout.

I think oil companies had like a 8.5% profit margin for the year 2005. How much lower can it go? Do you realize that federal, state, and local governments take up to 45cents per gallon of gasoline sold? The government makes a greater percentage of profit than the oil companies do!

And so what about $400 million retirement payout? You think he may have earned it? He had been with the company 12+ years and during that time they saw their stock price increase 300% and profits rise to record levels. If they hadn't given him the retirement payout that may have affected the price of gas by .000001%.

 

[b0mbrman]

Originally posted by: racolvin
Because, unfortunately, it is to the point where gasoline is a necessity, not a luxury. Whether I choose to go out to dinner or have a tuna sandwhich at home, or perhaps whether to buy that new computer game or not, can be based on price and market conditions. But, with few exceptions, I MUST have gasoline in order to generate income. If mass transit were the norm everywhere in America that might not be as big of a deal but it simply isn't the case. To get to my clients, I must drive my vehicle. To get to healthcare facilties, food sources, etc, I must drive and consume gasoline. I can certainly take steps to mitigate my consumption, in driving habits, vehicle maintenance, and even choice of vehicle, but ultimately I will still need gasoline.

All that rant is to say that gasoline isn't just a regular consumer good like any other that can happily ride the market ups and downs. I have no problem paying for gas and I have no problem recognizing that as raw materials costs rise so do the end product. That being said, the way the price rise, the frequency of change, and the percentage of profit from a good that I MUST have should be subject to more scrutiny than a Subway sandwich. Numerous other industries have their pricing and profits regulated, so why not gasoline?

If gas were something I could "take it or leave it", then I would be much more inclined to support a total free-market approach to its pricing. Since that's not an option, it needs to be treated differently.

So it's an addiction, you say?

I suppose we should be happy we're not charged $100 a gallon...to satisfy our fix and all...

 

[robphelan]

gas is sold at replacement cost. not the price at which it was refined originally

the gas you buy today might have cost 2.05/gallon to refine 2 months ago, but it can be replaced at 2.85 today. so, it's sold for 2.85.

the same thing applies when crude prices fall.. if it can be replaced at less cost, the current price goes down.

there are many things that go into the price of gas.

insurance is a big cost - can you imagine how much it costs to insure one oil tanker? and if there are terror threats or instability in a port, the cost of insurance goes up.

 

[jagec]

Originally posted by: Genx87

Originally posted by: tallest1

Bush unveils steps to counter high oil prices
"President George W. Bush on Tuesday gave U.S. refiners extra time to pay back emergency oil loans, and called on the government to find ways to ease new clean-burning gasoline regulations.

In a speech to the pro-ethanol Renewable Fuels Association, Bush said the U.S. Congress should find a way to approve permits to build new refineries a year after they are filed.

Bush said he told the Environmental Protection Agency to use "all available authority to grant waivers that would relieve critical fuel shortages," and said he would seek more waiver authority from Congress if needed."

OMFG, why are corporate handouts the solution to everything for this guy???

Reuters Link

How else are you going to promote an industry that is seeing record profits? What incentive do they have to create a cheaper alternative?

Giving them money and expecting them to lower prices out of the goodness of their own hearts is rather naive IMHO. The only thing that motivates a corporation is MONEY. There's nothing wrong with that, it's just the way things are. However, if you give them the carrot of extra money without the stick of possible fines for unreasonable pricing schemes, they'll just eat the carrot and not budge. Where's there motivation for lowering prices? Oil companies don't compete savagely enough for that to be much of an effect.

The government should control businesses by using tax breaks and fines to nudge them into the correct course of action. However, what does giving them money without any conditions accomplish?

The Republicans used to be really good at shepherding businesses, because they managed them purely from a financial standpoint, rather than a social. However, Bush seems to have gotten the message about using money, but totally missed the part where you use it as an incentive instead of just throwing it at them.

 

[mrchan]

Originally posted by: BriGy86

Originally posted by: mrchan
You're not paying for the gas in their tanks, you're paying for the cost to replace the gas in their tanks.

what?

so you're saying that when i buy a new LCD monitor im not paying for the monitor im paying for the cost of restocking the shelf?

No. I'm talking about gas.

LCD prices don't fluctuate by 5-10% on a daily, sometimes hourly, basis.

 

[JulesMaximus]

Originally posted by: SaturnX
I, for one, welcome our Middle Eastern overlords.

Fixed.