Aces High Bulletin Board
General Forums => The O' Club => Topic started by: Traveler on December 17, 2014, 10:01:13 AM
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Last time oil prices was $55.00 per barrel, the prices at the pump was under $1.00. per gallon. So why today with the price per barrel back at $55.00 and still dropping is the price per gallon at $2.50 at the pump?
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There is virtually no way this does not end up being a political discussion. I can lock it now, or ban/suspend people for taking it down that path.
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Just because they don't see it staying as low as 55 a barrel for an extended period of time. Fuel prices will never drop to 90's prices simply because of general inflation. It would like be saying there's suddenly a billion more dairy cows for just this year or two and expecting milk prices to halve.
Just do research on US shale and how OPEC is driving down the price just to undercut. "Not political, just fact"
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Inflation.
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See Rule #4
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Inflation.
Even adjusted for inflation it would put the price at the pump at about 1.30, not 2.50.
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Even adjusted for inflation it would put the price at the pump at about 1.30, not 2.50.
Well, you got those tax thingies too. :)
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Did anyone consider gas tax and transport to a limited amount of refineries as a reason. :bolt:
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They dont store all that oil in barrells :old:
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Part is the price already paid for the oil that has been refined. The gas price lags a bit, because of processing time
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Part is the price already paid for the oil that has been refined. The gas price lags a bit, because of processing time
In NZ this used to be a thing.... but as of the last year or so... it seemed as though they just changed as the price fluctuated.... everyday there was a different pump price here... still is....
not only that the variances can be quite large... i have a mobil which is constantly 5-8c cheaper than most other fuel stations in the Auckland region. Plus add to that the fuel vouchers available these days (over here all super markets offer a constant 6c off the pump price and on certain amounts spent and weeks you have the opportunity to get up to 30c (has been the highest).
Gassies just seem to pick a random number over here to put on the pump.... honestly it is crazy times....
as of today, on the way to the office I pass 5 service stations .... prices.... 173.9c.... 175.9c.... 184.9c.....176.9c......191.9c .... There is no rhyme or reason to the pump prices here in NZ (PS this is per litre)
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In NZ this used to be a thing.... but as of the last year or so... it seemed as though they just changed as the price fluctuated.... everyday there was a different pump price here... still is....
not only that the variances can be quite large... i have a mobil which is constantly 5-8c cheaper than most other fuel stations in the Auckland region. Plus add to that the fuel vouchers available these days (over here all super markets offer a constant 6c off the pump price and on certain amounts spent and weeks you have the opportunity to get up to 30c (has been the highest).
Gassies just seem to pick a random number over here to put on the pump.... honestly it is crazy times....
as of today, on the way to the office I pass 5 service stations .... prices.... 173.9c.... 175.9c.... 184.9c.....176.9c......191.9c .... There is no rhyme or reason to the pump prices here in NZ (PS this is per litre)
Price for me is $2.02
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Price for me is $2.02
these prices I have put up today have only been around for the last couple of weeks... we were at 214.9-220.9c for most of the year...this is 91 also... the 96 is always about 10c more and the 98 usually about 20c and the 96/98 prices don't change at most stations when the prices of 91 fluctuate...they use it as a drawcard....I had to learn which stations altered all prices.... which my local one does....
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There is virtually no way this does not end up being a political discussion. I can lock it now, or ban/suspend people for taking it down that path.
Its a discussion on oil and gas prices. If you think that can only be political, that's your problem.
He is not saying that he thinks it can only be political. He is saying that historically this type of discussion does become political, and degrades to the point where it gets locked. So let's see if we can keep it from going that direction.
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While the price per barrel of oil is coming down, the prices of other parts of the process are still up. Logically, you would think that all the other costs would come down too, eventually. And they might. But then you have business people thinking, "Hmm. Cost are down, profits are up. This is good."
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Part is the price already paid for the oil that has been refined. The gas price lags a bit, because of processing time
The cost didn't lag when the cost of a barrel went up.
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Well, you got those tax thingies too. :)
^ this guy is onto something there...
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Depends on state, road taxes, and also the addition of ethanol for gassers or the sulfur content with additives if your a diesel user.
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The cost didn't lag when the cost of a barrel went up.
I think you mean the price per gallon at the pump didn't lag, if it meant you were making more $ you prolly wouldn't let there be any lag either.
Gas/oil makes money, hospitals make money, large caps make money...invest in them and then you'll be invited to the party when their price/profits go up.
As Gary K says every day, why do ppl invest in co's that have no earnings...??? Buy winners.
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They dont store all that oil in barrells :old:
actually they do, at least that's how they account for it. Interestingly they use 50 gallon barrels but only put 44 gallons per barrel. I spent 8 years working for Mobil Oil Aviation and learned a lot about the oil business.
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See Rule #5
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Well, you got those tax thingies too. :)
true but the tax thingies have always been there. The problem being that when they were established they were defined as a percentage of the total price. That percentage has now become a larger portion of that price. But even if you scale back or remove taxes we are still being charged about a 1.00 to much.
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The answer is.... They don't have to!
It is a necessity. (Falicy) Everyone needs it!
Let's look at supply and demand.
The demand has grown a lot higher since the prices have been going down. The demand is also much higher since the 90s considering there are more people driving today than before. Typically when demand goes up, so do the prices. But they are competing with a group that is making it so cheap that OPEC must compensate to compete which means every other gas company must do the same. Inflation and taxes are one factor, the US having its own gas is a factor. You could make the mathematical arguement that $2.20 today is equal to $1 in the 90s. Don't know the math but it's probably somewhere close. OPEC is nervous right now because they don't know what's going to happen.
But, they still want to make the highest profit they can while meeting their quota, therefore, they do not really need to lower prices nore do they want to unless the other group continues to out compete them with lower prices in the market. Essentially we commend that other group for doing this, but at the same time they are Evil and even more corrupt and we all want them to die. Soo who knows how long these prices will last.
What will America do? If we build that pipeline, it will be game over for mannny oil companies who supply to the US. So OPEC has been worried about that as well.
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The gas you buy today, was refined from oil purchased upwards of several months ago. That makes the current price of a gallon of gas a function of oil say when it was at 70$ a barrel. The oil being pumped today may not reach the market as gasoline for a short while.
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The gas you buy today, was refined from oil purchased upwards of several months ago. That makes the current price of a gallon of gas a function of oil say when it was at 70$ a barrel. The oil being pumped today may not reach the market as gasoline for a short while.
That's not quite true, the oil company must pay taxes on inventory held in storage at the end of year. All the expensive oil has been sold, according to their own booking, only the $49 a barrel is in storage, which they will pay taxes on as of December 31.
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The answer is.... They don't have to!
It is a necessity. (Falicy) Everyone needs it!
Let's look at supply and demand.
The demand has grown a lot higher since the prices have been going down. The demand is also much higher since the 90s considering there are more people driving today than before. Typically when demand goes up, so do the prices. But they are competing with a group that is making it so cheap that OPEC must compensate to compete which means every other gas company must do the same. Inflation and taxes are one factor, the US having its own gas is a factor. You could make the mathematical arguement that $2.20 today is equal to $1 in the 90s. Don't know the math but it's probably somewhere close. OPEC is nervous right now because they don't know what's going to happen.
But, they still want to make the highest profit they can while meeting their quota, therefore, they do not really need to lower prices nore do they want to unless the other group continues to out compete them with lower prices in the market. Essentially we commend that other group for doing this, but at the same time they are Evil and even more corrupt and we all want them to die. Soo who knows how long these prices will last.
What will America do? If we build that pipeline, it will be game over for mannny oil companies who supply to the US. So OPEC has been worried about that as well.
I think this is pretty much how close we can get to the answer without getting into politics. It isn't a normal situation and therefore the market doesn't respond normaly. Just enjoy this short time of low prices, the risk is that the situation will backfire in one way or another.
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The answer is.... They don't have to!
It is a necessity. (Falicy) Everyone needs it!
Let's look at supply and demand.
The demand has grown a lot higher since the prices have been going down. The demand is also much higher since the 90s considering there are more people driving today than before. Typically when demand goes up, so do the prices. But they are competing with a group that is making it so cheap that OPEC must compensate to compete which means every other gas company must do the same. Inflation and taxes are one factor, the US having its own gas is a factor. You could make the mathematical arguement that $2.20 today is equal to $1 in the 90s. Don't know the math but it's probably somewhere close. OPEC is nervous right now because they don't know what's going to happen.
But, they still want to make the highest profit they can while meeting their quota, therefore, they do not really need to lower prices nore do they want to unless the other group continues to out compete them with lower prices in the market. Essentially we commend that other group for doing this, but at the same time they are Evil and even more corrupt and we all want them to die. Soo who knows how long these prices will last.
What will America do? If we build that pipeline, it will be game over for mannny oil companies who supply to the US. So OPEC has been worried about that as well.
the answer is, They do if you stop buying their product and the demand is not up, it's down, it's down world wide, Not just in the US.
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See Rule #12
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See Rule #12
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since I posted I have come back home...on the way the same service stations have all upped their prices by 10c.... as I say...over here there is no rhyme or reason to the fuel prices... over the next couple of days they will change again... they will lower the price a couple of days prior to Christmas eve and then up it again on Christmas eve to catch out those who are waiting to fill up before traveling.... totally greed driven.
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since I posted I have come back home...on the way the same service stations have all upped their prices by 10c.... as I say...over here there is no rhyme or reason to the fuel prices... over the next couple of days they will change again... they will lower the price a couple of days prior to Christmas eve and then up it again on Christmas eve to catch out those who are waiting to fill up before traveling.... totally greed driven.
Prob right, If people now think that the gas is really cheap, why lower the price even more?
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Even adjusted for inflation it would put the price at the pump at about 1.30, not 2.50.
i think that the drop in price per gallon is lagging behind the price per barrel. it seems to be dropping between 2 and 4 cents a gallon per day around here. i fully agree though, that gas should be well under 2 bucks a gallon right now though.
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I wish it was under $1 a gallon, but then again I wish I could actually win something when I play the lotto too
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The price is determined by the international market, so your local issues have a delayed effect upon the price at the pump. Also, it takes 3-6 months for the price per barrel to influence the market. Even that assumes that the refineries are waiting for new oil, and if the price goes lower or higher that will change it too. A dip in the price per barrel over a short period will not have a large influence, so hope the price of a barrel stays low. Talking about fuel prices on the news is just a way to get the publics attention so you watch their advertising. There is almost no desire to inform you about news that will make any difference, but television/radio/newspaper is there to market goods to you.
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See Rule #12
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Yes, that's the ticket it's the steel! Glad you can sum up complex forces of economics, buying on the margin, speculation and multi-national treaties regarding trading the commodity.
Steel cost :rolleyes: really?
that's one.
semp
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See Rules #2, #4, #5
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See Rules #2, #4, #5
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Even when the price of a raw material goes down, the price of processing it into a finished product and transporting it to the end user will always go up.
Putting crude oil in a barrel is the easy part. Refining it and sending it all over the world requires a lot more effort.
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The price is determined by the international market, so your local issues have a delayed effect upon the price at the pump. Also, it takes 3-6 months for the price per barrel to influence the market. Even that assumes that the refineries are waiting for new oil, and if the price goes lower or higher that will change it too. A dip in the price per barrel over a short period will not have a large influence, so hope the price of a barrel stays low. Talking about fuel prices on the news is just a way to get the publics attention so you watch their advertising. There is almost no desire to inform you about news that will make any difference, but television/radio/newspaper is there to market goods to you.
Maybe where you live but here if the price/barrel went up the price at the pump went up immediately.
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See Rule #12
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One of the grocery chains in this area has a "rewards" program whereby you build up cash towrds a 20 gallon fuel purchase. Used mine yesterday and the per gallon price came out to being .36 cents per gallon. I know its a gimmick, but still was nice to get 20 gallons for roughly 7.50....
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but if it makes you feel better, I'll tell you that our mill just sold a lot of pipe used to move oil between refineries. and the price of pipe has gone up 20 times from back in the day. btw so has the salaries of the workers working at the refineries and the price of electricity and gas and water. so while the price of one barrel of oil is the same as 20 years ago, all the other stuff that goes into making it has gone up in price. so no, the price wont go down to 1 dollar per gallon. well it might but then again, you can also buy a lottery ticket.
Exactly. Oil is the raw material. Even if the cost of the raw material goes down, the cost of processing and transporting does not change. The cost of oil makes of about 60% of the cost of gas. The rest is distribution, refining, taxes, and markup.
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Exactly. Oil is the raw material. Even if the cost of the raw material goes down, the cost of processing and transporting does not change. The cost of oil makes of about 60% of the cost of gas. The rest is distribution, refining, taxes, and markup.
Yes and in 2014 Exxon/Mobil's markup was 40 Billion dollars, that 40 Billion after all the expense to find, drill, transport , refine and distribution.
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That would be true if they actually put it in steel barrels , as I stated they do their accounting in barrels, but most crude is transported via pipeline and held is huge storage tanks, they just do there accounting in barrels.
traveler my comment about barrels was a joke.
semp
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Yes and in 2014 Exxon/Mobil's markup was 40 Billion dollars, that 40 Billion after all the expense to find, drill, transport , refine and distribution.
Yes, on 400+ billion in sales. Don't forget than Exxon/Mobil pays 30+ billion a year in income taxes as well.
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:rofl
waste of time
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to be honest, regardless of why the price of gas is down. I dont really care, i am just happy I can fill my tank up with 20 bucks less than 2 weeks ago. enjoy while you can ladies. it's gonna go up as soon as they feel like it. price of gas doesnt make sense. I have about 15 or 20 arco stations within 15 miles. they all have different prices.
word of advise, never buy gas right next to a freeway or highway or whatever they call it in your state. they have the highest prices.
semp
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Exactly. Oil is the raw material. Even if the cost of the raw material goes down, the cost of processing and transporting does not change. The cost of oil makes of about 60% of the cost of gas. The rest is distribution, refining, taxes, and markup.
aaahhhh yes, but those costs both DO go down. they both involve the burning of so-called fossil fuels. if the cost of the fuel drops, then the cost of the production/transportation goes down.
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One of the grocery chains in this area has a "rewards" program whereby you build up cash towrds a 20 gallon fuel purchase. Used mine yesterday and the per gallon price came out to being .36 cents per gallon. I know its a gimmick, but still was nice to get 20 gallons for roughly 7.50....
Krogers?
I see that here, but I couldnt get myself to spend that much there just to save a few cents a gallon on gas where I can get the same food cheaper at another store
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Today's fun fact... My store profits 18 cents a gallon sold... If the cost of that fuel goes down, my price goes down as long as I get 18 cents a gallon...
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Today's fun fact... My store profits 18 cents a gallon sold... If the cost of that fuel goes down, my price goes down as long as I get 18 cents a gallon...
And am I correct that you do not know what you will pay for the next truckload until it arrives to unload?
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Today's fun fact... My store profits 18 cents a gallon sold... If the cost of that fuel goes down, my price goes down as long as I get 18 cents a gallon...
funner fact. I have 4 arco gas stations within 4 miles of my house, they all have different prices. same for chevron, shell...
semp
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I'm sorry, was anybody expecting the capitalist elite to be in any way fair or generous?
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I smile at the pump now. Owning and having to fill 2 4dr 2500 series Silverados can be painful at times.
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Today's fun fact... My store profits 18 cents a gallon sold... If the cost of that fuel goes down, my price goes down as long as I get 18 cents a gallon...
guy i used to work for was struggling to sell his gas(this is about 10 years ago) and make 5 cents on a gallon(after all of his expenses etc)
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I'm sorry, was anybody expecting the capitalist elite to be in any way fair or generous?
why not, I am quite generous when I buy their gas at their own price :D.
semp
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And am I correct that you do not know what you will pay for the next truckload until it arrives to unload?
Wrong - We are "commissioned" to sell the fuel - not buy it to sell ourselves... They dump the fuel - we sell it for them - we make the commission... And that amount per gallon is fixed and re-negotiated every year...
They set the "recommended" price - not us - it's based completely on supply and demand - this is why we do market maps for them as well.
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Ask yourself. Why do they have to lower the price?
Their main expneses:
The inflation rate is 1.3%. Its a factor but not a big one. Tax/terrif .09. Packaging 34% gas station sales 18%, railroad,shipping 15%, mining, 25%. The other ~7-10% is gifts (cough) lobbying (cough).
They know what people will spend. Trust me they want to raise it back to $4.00
The reason they are lowering prices is to compete with the company(group) who is attempting to undercut them, unfortunately in a very unethical and immoral way.
So by cutting these prices they will minimize the other groups profits/gains in the market. OPEC has the power to do that/money to fool around. So it puts the other company who has very similar goods in a very competive situation. It is strategy by large companies to dominate or at least pull equal sales by a growing company in the market.
Fuel is all the same. So OPEC has to bully and match the compition from a business perspective, to keep the other group from gaining market share, until the bad group is formitably defeated for cheating the system and being evil.
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I smile at the pump now. Owning and having to fill 2 4dr 2500 series Silverados can be painful at times.
I only have one 2500 in 2wd but, my 19yr old daughter is who drives it while I'm on the road. So...still painful :D
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I only have one 2500 in 2wd but, my 19yr old daughter is who drives it while I'm on the road. So...still painful :D
Be there with you soon Dacoon....I have 14yr old Boy/girl twins.... :O :bhead
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twins?!?!?!? OUCH!!!!!! kinda sounds like twice the pain......... :devil