Fight gas price gouging

[Fishu]

AFAIK the US refineries are from stone age and there hasn't been any significant increase in the capacity since the 70's. Refined gas is transported to the USA even from Finland. I'm sure the end product costs more if there isn't sufficient capacity to produce it locally. There's enough oil, but not enough refineries.

[Charon]

AFAIK the US refineries are from stone age and there hasn't been any significant increase in the capacity since the 70's. Refined gas is transported to the USA even from Finland. I'm sure the end product costs more if there isn't sufficient capacity to produce it locally. There's enough oil, but not enough refineries.

nope. those were shut down in the 1980s-1990s. We process about 17.5 million barrels of crude oil each day with consumption near 21 million barrels a day. Imports make up the differential, but in a cost effective manner. Imports rise during events like Katrina where the price of gasoline leads to it flooding the market through natural makket pressures -- which tanks th higher prices fairly quickly.

The API statistics also showed that U.S. refineries and blenders produced record amounts of gasoline and distillate fuel oil in 2006 and refinery capacity expanded for the 10th straight year. Since 1996, U.S. refiners have expanded capacity by more than 2 million barrels per day, or 14 percent. The blending of ethanol into gasoline reached a new high of more than five billion gallons and production of new clean-burning ultra low-sulfur diesel fuel topped a record 2.6 million barrels per day by the fourth quarter.

We have basically added one medium sized refinery each year in extra capacity from our existing units. And, there is a reason for no rush to generate built-in overcapacity.

With many years of low returns on investment until recently, U.S. refiners are still faced with uncertainty over whether they will earn adequate returns on capacity expansion investments. Further inhibiting a rapid expansion in supply, tightening U.S. specifications relative to much of the rest of the world implies higher prices may be required to attract increasing import volumes - at least for the next few years. While both sources of supply (imports and capacity) will meet demand, it is not likely that we will see excess refining capacity such as that in the 1980s and early 1990s anytime in the near future.
http://tonto.eia.doe.gov/oog/info/twip/twiparch/040714/twipprint.html

Charon

[lasersailor184]

Originally posted by Silat
The problem is that the oil companies are manipulating the market through
selective refinery 'maintenance shutdowns'.  On top of the below article I
was watching CNBC and a gasoline trader said anybody who watches the market
realizes that supply has been manipulated to keep prices up.

Gas prices reflect refinery gouging

By: CHARLES LANGLEY - for the North County Times
Big Oil's earnings statements read more like a confession than a profit
report.

As North County's gas prices edge toward $3.50 a gallon, consumers should
know that gasoline now costs 11 cents more than it did last year when oil
was selling for $11 more per barrel. For example, on Thursday, the North
County Times reported that the average price of gasoline was $3.41 a gallon.
Meanwhile, the price of oil was $63 a barrel. On the same day last year, the
price of oil was $74 a barrel, and gasoline cost just $3.30 a gallon
(source: U.S. Department of Energy).
Something is terribly wrong when oil prices drop and the cost of gas goes
up. Big Oil says it is all about "supply and demand," but the ugly truth is
that North County residents are getting gouged deeply. Here's why: An $11
decrease in the cost of oil should mean a price cut of 26 cents from last
year's price of $3.30 a gallon. The industry says it "struggles" to keep up
with demand for gasoline, but according to the California State Board of
Equalization, gasoline demand in the last half of 2006 was 1 percent lower
even though there are more drivers on the road. While the report does show a
1 percent bump in gasoline consumption during January 2007, the cost of
gasoline in North County averaged $2.53 a gallon ---- almost a dollar less
than it does now.

What has happened is that the oil companies have shifted their profits
centers from the "upstream" sector (oil and drilling) to the "downstream,"
which is refining. In the meantime, retailers are limited to an average
profit of about a nickel a gallon.

Last week, Big Oil's first-quarter profit reports came rolling in with more
bad news for consumers. On April 26, Exxon/Mobil reported that even though
it produced less product than last year, it earned profits of 10 percent on
unusually high refinery margins (source: MarketWatch) and that the margins
were so high that the company "overcame lower crude oil and natural gas
prices" (source: Associated Press).

The following day, April 27, Chevron joined the obscene profit bandwagon by
announcing that it earned first-quarter profits of 18 percent, much of it on
increased refining margins, even though the company produced less gasoline
than last year (source: Associated Press, International Herald-Tribune).
Meanwhile, Valero announced that it made the highest first-quarter profits
in the company's history. Valero Chairman Bill Klesse said longer downtimes
for planned refinery maintenance helped create the shortages that reaped
record-shattering profits (source: San Antonio Business Journal). And on
Thursday, Shell announced that despite "unusually low seasonal gas demand,"
that "better refining margins, particularly in the U.S. West Coast," drove
profits sharply higher (source: MarketWatch.)

Bottom line: These aren't "profit reports," they are confessions.

Exxon didn't "overcome" low oil prices, as the reports suggest. It gouged
its way to higher profits due to an almost complete lack of competition at
the refinery level. And so did Chevron, Shell and Valero. They did it by
restricting supply, panicking the markets, and intentionally underproducing
gasoline.

Charles Langley is a gasoline analyst for UCAN, the San Diego-based Utility
Consumers' Action Network. He also collects gas-price data for the North
County Times. He edited UCAN's free 32-page guide, the "Guzzler Buster: 127
Secrets to Squeezing More Miles From Each Gallon." UCAN's "Guzzler Buster"
is available free of charge to San Diego County residents who visit the UCAN
Web site at http://www.ucan.org.

This is proof that you can prove anything when you throw numbers at stupid people.

[bj229r]

yawn. Umm..."commodity"...."supply/demand"....never mind...it's Halliburton

[Silat]

Originally posted by lasersailor184
This is proof that you can prove anything when you throw numbers at stupid people.

Its funny how your numbers are right but anyone elses are wrong. LOL. Who doesnt understand that the corps are out after bucks no matter what?
Republican mantra: Corps are good. Dont bother them. Let them work they will take care of you. LOL

[lasersailor184]

Originally posted by Silat
Its funny how your numbers are right but anyone elses are wrong. LOL. Who doesnt understand that the corps are out after bucks no matter what?
Republican mantra: Corps are good. Dont bother them. Let them work they will take care of you. LOL

It's funny how there are 7-10 individual independent factors that affect the price of gas.  Your author defines the price of gas based on a single factor.

This reality thing is painful, isn't it?

[CHECKERS]

>> George Carlin's Solution to Save Gasoline
>>
>> Bush wants us to cut the amount of gas we use.  The best way to stop
>> Using
>> so much gas is to deport 11 to 20 million illegal immigrants!  That would be
>> 11 to 20
>> million less people using our gas.  The price of gas would come down.


>> Other perks.... alot less uninsured  illegal, unlicensed drivers.



 

[lazs2]

Here it is sales tax that is  the big gouge..

The sales tax on a gallon of gas has tripled since gas was a buck twenty.

Every increase in the price of gas brings an increase in the sales tax portion.

lazs

[bj229r]

Originally posted by lazs2
Here it is sales tax that is  the big gouge..

The sales tax on a gallon of gas has tripled since gas was a buck twenty.

Every increase in the price of gas brings an increase in the sales tax portion.

lazs

There ye go...ya'd think California liberals would be HAPPY about that--make price of gas ghastly high, will force people to use less, thus ending global warming, world hunger, AIDS, psoriasis, ..... but NOOOO...whereas taxing the @#$@#$ out of evil cigarettes is GOOd...taxing the %$%% out of evil gas is WROONNNGggg, as the evil oil companies aren't hurt at all. If ONLY there was a way....

[lasersailor184]

Originally posted by lazs2
Here it is sales tax that is  the big gouge..

The sales tax on a gallon of gas has tripled since gas was a buck twenty.

Every increase in the price of gas brings an increase in the sales tax portion.

lazs

Are you sure about that?  I thought the tax on gas was flat and not determined by a percentage.

[Holden McGroin]

In Oregon we have no sales tax, but in Cali,  you still pay (what is it now 7%?) sales tax on the pump price... including the 40 ro 50 cents tax on each gallon.

So you pay tax on the amount of tax you pay.

[lasersailor184]

Isn't double taxation illegal?

[Holden McGroin]

most sales tax is collected based on sales prices that have some hidden tax within them...