Tuesday, June 10, 2008

Oil and Obscene Profits

Oil companies make about 4 % profit on gasoline, a very low rate of return. The majority of the money we pay at the pump goes toward the raw materials (oil), transport, refining, salaries, exploration and research. That leaves about 15 % unaccounted for.

That 15 % goes to the government as taxes.

That's right! If we pay $4.00 for a gallon of gas, the oil company gets to keep $0.16 as profit. But the government who does nothing but bitch about "obscene oil profits" gets $0.60 and the Democrats want to impose a "windfall profit tax" on oil companies which will drive the price even higher.

These same Democrats have did everything in their power for the last 30 years to limit production and exploration of domestic sources and raise the price of gasoline.

This is intentional people! We are being shafted by watermelons, (green on the outside red on the inside), in congress and the so-called "environmental groups".

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20 comments:

FJ said...

They're just all jealous of Hugo Chavez... a politician who can run his entire government w/o tax revenues from the people and who is perfectly free to do whatever he wants without having to answer to them.

Brooke said...

I've heard that oil's profit margin is as high as 8.5%... Still quite low when compared to other industries.

Ducky's here said...

How much of the price per bbl. of 140 is speculation and essentially a bubble in oil prices which will collapse eventually?

All bubbles pop. This is a bubble, generated by the oil speculator wing of the major oil companies operating, thanks to a Phil Gramm rider in the 2001 budget, without oversight. What's that you say? The majors aren't working the futures and managing hedge funds to generate profit off the books? Only a right wing sucker would believe they aren't.

So I expect oil to pop, take a HUGE drop in price, and then run back up more slowly due to actual demand/supply problems.

Freedomnow said...

When I worked at Sempra Energy, our company endorsed the Democratic Party.

Back then I was a supporter of the Democratic Party myself, but things change...

Papa Frank said...

I'm anxiously waiting for the POP that Ducky spoke of here. However, I won't be holding my breath as this is a farce and the POP is never coming if we leave things alone.

Always On Watch said...

Recent article at U.S. News: "Riding the Oil Boom." Excerpt:

But beneath the one-upmanship, there is far a more serious transformation, one that is turning Dubai into the business, financial, and perhaps tourist center of a newly invigorated Persian Gulf region. With oil prices near record levels, the Gulf is on the receiving end of a historic transfer of wealth from oil consumers that dwarfs previous oil booms, even after adjusting for inflation. Just between 2002 and 2006, Gulf economies doubled. And this time, in contrast to earlier oil booms when most of the profits were reinvested in the West, Gulf states like the United Arab Emirates, Qatar, and Saudi Arabia are investing much more of that windfall at home.

More than $1 trillion of construction projects is currently underway in the Persian Gulf states, but the changes aren't just about the vast amounts of concrete, glass, and steel being erected. Indeed, this unprecedented wealth transfer is starting to rewrite the fundamental balance of power in the world economy, says Robert Hutchings, who as the head of the U.S. National Intelligence Council until 2005 led a project looking at what the world might be like in 2020. The rise of the Gulf economies "should give us pause about how much we Americans and the countries that created the global financial system 60 years ago still have control of it," he says. "The globalized economy doesn't require huge territory or militaries to translate into real power."


How long before America becomes a Third World country?

Warren said...

Nostradumbass said:

"Only a right wing sucker would believe they aren't."

Proof?

You've heard of that somewhere I'm sure but your posts consist, on the main, of stupid leftist nonsense bordering on conspiracy if not drifting completely over the line.

It would seem that on the main those speculators manage the pension funds of those well known bastions of conservatism, Universities and public employees unions.

Regardless of your bullshit, its a two part problem, there couldn't be a "bubble". Supply "and" demand.

With the demand for oil rising expotentionally in India and China, world demand increases while the supply has increased relatively little.

Your buds caused this problem with their Luddite world view. They intentionally have torpedoed every attempt to drill for oil in the US and its coastal waters while axing every attempt to create coal or nuclear power plants. While you run your yap, China and Cuba drill for oil in the Gulf less than 70 miles from Miami, we we are forbidden to explore or drill.

Quite frankly, as usual, you don't know what the hell you're talking about.

cube said...

Drill here, drill now!!!! That's my newest motto.

Warren said...

FJ,
Brooke,
The largest oil companies are foreign and owned by their governments. 94 % of oil reserves are nationally owned by those same foreign oil companies. They are cash cows for their respective governments.

During the most recent dog and pony show in Washington when the oil exec were interrogated, (if not water boarded), Cynthia McKinney threatened to Socialize the Oil companies.

I think that there might actually be a conspiracy among the Democrats to first create an "energy crisis" then "Nationalize" the American oil companies in answer to "public outcry". What could be sweeter for a pack of socialist politicians? Instead of just getting the lions share of oil revenue they would get the whole thing and could set the price and punish the "wicked" and reward the "devout".

Warren said...

Thanks for Posting that AOW.


Cube, I'm with you!

nanc said...

yes, drill now - i want $0.12 per gallon gasoline! not.

y'all do realize the next wave will have the government owning our fuel?

'member maxine waters statement about nationalizing oil a week or so ago?

i used to purchase fuel for a trucking company which meant finding a fuel company that sold fuel at least two cents cheaper than the previous fuel company i checked with - when it came down to it, we got our fuel at the most $0.04 cheaper than what it was being sold for at the pump.

i'm thinking about getting some horses - at least hay is still cheap!

nanc said...

$2.00 a bale...

*8]

Brooke said...

Warren: I wouldn't be surprised if there were a conspiracy.

I actually posted the clip of Maxine Waters fumbling all over herself after she said "THIS liberal will be all about socializing..."

Disgusting.

Nanc: It's the maintenance that gets 'ya? Lots 'o poo to scoop. Of course, I DO have children...Mwaahaahaa!

FJ said...

What could be sweeter for a pack of socialist politicians...

Indeed. Who needs to listen to the people when you don't have to go to them and ask them for the money you need to do something?

FJ said...

But then, "deficit spending" is what has allowed them to walk further and further down the path of socialism. Need money? Just raise the cap on the National Debt.

Always On Watch said...

Yesterday I posted a map of oil resources in the United States. It's a USGS map.

Ducky's here said...

Conspiracy? Fascinating.

Notice that the G8 is focused on speculation rather than a simple supply/demand issue. Of course they are just Euro-Commies who are in on the conspiracy, I imagine.

Meanwhile, how much money is invested in futures and hedge funds by the majors to elevate the price of oil? Since the market has tanked the money has to be going somewhere. They would be complete idiots to use it to buy back inflated shares.

But we just sat on our hands the last eight years never thinking we might have to improve fuel economy or invest in a transportation plan or multiple sources of energy. Just gas up the old SUV.

Conspiracy? Yeah, by Cheney and the majors. You lose.

FJ said...

LOL! Some people never heard of OPEC. OPEC is the "regulation of capitalism" on steroids.

FJ said...

EPA and the "global warming" scare are the keys to keeping control of the world's energy supply FIRMLY in OPECs hands.

Warren said...

Well Nostradumbass,
Seeing as you can't allow that the supply/demand equation is destroyed by crippling the supply, you are shown to be full of shit, once again.

The government is the one raking in the big bucks and your assertions are totally spurious or you would show some proof instead of proclaiming victory and slinking off.

Once again, Warren, advances in total defeat while, Nostradumbass, retreats in glorious victory.

Your bait and switch speculation is one of your typical distractions and only shows your inability to process information at anything higher than sesame street levels, (i.e. One of these things is not like the other.)

So tell me, how much do you have invested it the futures market or hedge funds?