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Awash In Profits Exxon Extracting Every Cent From Franchises
huffingtonpost.com — Every time Sohaila Rezazadeh rings up a sale at her Exxon station on Chain Bridge Road in Oakton, her cash register sends the information to Exxon Mobil's central computers. If she raises the price of gasoline a couple of pennies, chances are that Exxon will raise the wholesale price she pays by the same amount.
breeder- 878 diggs
- digg it
- EatChex89, on 05/25/2008, -9/+6Time for Rezazadeh to switch to those calculator cash registers!
- PhilLesh69, on 05/26/2008, -0/+1She can't. I buy gas at that station every so often, if I'm ever heading over to Fairfax City, or something. She's a franchisee, she cannot simply bypass the corporate owned cash registers.
Besides, the pumps are where most of the point of sale transactions are recorded, since most people in the DC are use credit cards (and probably now that it costs almost $75 to fill a tank, I'm guessing that most people are using credit cards to fill their tanks.)
- PhilLesh69, on 05/26/2008, -0/+1She can't. I buy gas at that station every so often, if I'm ever heading over to Fairfax City, or something. She's a franchisee, she cannot simply bypass the corporate owned cash registers.
- petska, on 05/25/2008, -11/+12Use Shell or Sunoco, dont feed the beast anymore
- nstanosheck, on 05/25/2008, -3/+7I like Shell because they actually have Hydrogen stations in Washington D.C. and a few other cities. They also are investing in wind power, solar, and many other alternative fuels. They seem like one of the few oil companies that actually cares about alternative energy solutions.
- scotticus, on 05/25/2008, -1/+6I think Exxon spends a ton of money on alternative energy R&D, but they aren't rolling anything out yet because oil is still so profitable. Their position is that they are going to milk that cow until the teats run dry, while at the same time making sure they have something ready to replace it when the time comes.
At least that's what I was told.- Neoanarchist, on 05/25/2008, -0/+2By whom? Not trying to be an ass, just curious. That is a logical presumption, but I find that when it comes to copious amounts of money (read: greed), logic rarely factors into it.
- CerpinTaxt101, on 05/25/2008, -0/+1From my understanding its true. my girlfriend is an engineer for Chevron and they spend a ton of money for good environmental purposes, she showed me some of the programs they have in place and they help with a lot of scientific research and upkeep of species, not to mention all the volunteer events they have of tree planting and numerous other things that are not talked about. I hate to sound like a shill but they really do a lot of things people want done and don't do.
- scotticus, on 05/26/2008, -0/+1I was told by a friend of mine whose in-law works for Exxon.
- PhilLesh69, on 05/26/2008, -0/+1It only makes sense.
I mean, whether by greed or by rational protection of a market, nobody is going to roll out technology that kills their current bread and butter.
That doesn't mean it is right to withhold better technology, it just makes sense that someone would do that to serve their own interests.
- unreg, on 05/25/2008, -0/+7Don't fool yourself. Business is business.
- haydesigner, on 05/25/2008, -4/+2I still boycott Shell because they supported the anti-apartheid regimes in South Africa.
- yardie, on 05/25/2008, -1/+2Am I reading this right? You're boycotting a company that supported a regime against apartheid?
- haydesigner, on 05/26/2008, -0/+1Sorry, I meant *I* was anti-apartheid, and Shell actively supported the apartheid government. Which should have been obvious to anyone who knows even a bit of the history of the world.
- scotticus, on 05/25/2008, -1/+6I think Exxon spends a ton of money on alternative energy R&D, but they aren't rolling anything out yet because oil is still so profitable. Their position is that they are going to milk that cow until the teats run dry, while at the same time making sure they have something ready to replace it when the time comes.
- Ydnar723, on 05/26/2008, -0/+3I avoid Exxon/Mobil stations. They are always the highest in any city in my State I have been around. I know someone who owns an Exxon station and they jacked the price of gas so high on him he actually stays open 6 instead of 7 days a week because he does not make enough to offset the costs of operating the station that one day of the week.
Unless I am real low on fuel, and theres an exxon station up ahead, but I know there is a better and cheaper gas station further ahead, I will only toss in a gallon so I can put the extra 10 miles to avoid giving up all my money to Exxon. I am convinced Exxon rips off businesses much more then other companies do at the wholesale level. - tmyprod, on 05/26/2008, -0/+6I won't even get drinks, let alone gas, at Exxon/Mobil. As an Alaskan, I'm still pissed.
- PhilLesh69, on 05/26/2008, -0/+1I'm sure this is not isolated to Exxon. I suspect this is standard throughout the industry.
I read the article in the Washington Post this morning (the actual paper, not online.) One guy, Daggle, who owns 5 stations around Fairfax County (where I live) ends up making 8 cents a gallon at each station, even though his prices vary at each one (because a competitor across the street may be cutting prices, or charging even more).
There is something wrong when all of their gas comes from the tank farm across the street from Fairfax Ice Arena, and yet the wholesale price of the same gas from the same tank farm, often from the same truck, can vary from station to station. I understand volume discounts and that sort of thing, but I would venture a guess that there is very little variance in volume sold, on average, in this area. Sure, there might be a station that is just hard to get to due to traffic patterns, being mid block on a road with a median, or something, but for the most part, the DC area is so saturated with drivers that any gas station is going to have a steady flow of business. - LeeSoong, on 05/28/2008, -0/+1Welcome to the joy of franchising - otherwise known as legal slave trading.
When you become a Franchiser of any big corporation,
they own everything - the name, the store, your advertising.
All you own is the inventory that you pay for,
and the work you produce. It is pennies on the dollar folks.
Do you think the guy at the Mini-mart is driving a
new BMW ? The workers are lucky if they are making above minimum wage, and the franchisees are only pulling in a little more than that.
To make real money, 1 person needs to own 5 or more stores.
My advice - Go independent. Get a loan and build up your own gas station in a better location. Right near an on / off ramp of a major highway is a good place to sell fuel.
Near homes and schools is a good place to sell snacks.
You'll earn more profits from snacks and coffee than from the fuel.
An Ice cream stand can earn more profit than a gas station,
if you put it in a nice location near homes, schools, parks and churches - places where large groups of people and families come, and no fast food is near by.
- nstanosheck, on 05/25/2008, -3/+7I like Shell because they actually have Hydrogen stations in Washington D.C. and a few other cities. They also are investing in wind power, solar, and many other alternative fuels. They seem like one of the few oil companies that actually cares about alternative energy solutions.
- StingingNettle, on 05/25/2008, -2/+4What about the tiger mart? That's where the money is.
- chicoer2001, on 05/25/2008, -2/+12From the real article: "He said micromanaging extends to the snacks sold at Exxon's On the Run convenience stores. The company uses a "planogram" to show dealers where to put candy bars and soda. "If I want to put Coke on a different shelf, I have to get special permission," Daggle said. Recently he was reprimanded for selling mulch on the perimeter of his award-winning Gainesville station; the mulch, though popular in the neighborhood, wasn't an approved product."
They set all the prices
- chicoer2001, on 05/25/2008, -2/+12From the real article: "He said micromanaging extends to the snacks sold at Exxon's On the Run convenience stores. The company uses a "planogram" to show dealers where to put candy bars and soda. "If I want to put Coke on a different shelf, I have to get special permission," Daggle said. Recently he was reprimanded for selling mulch on the perimeter of his award-winning Gainesville station; the mulch, though popular in the neighborhood, wasn't an approved product."
- nastronomical, on 05/25/2008, -26/+14huffingtonpost? Come on you guys know this is utter crock. Btw 82 diggs and 3 comments? Once again proving Digg is running into the ground.
- twiztidsinz, on 05/25/2008, -2/+8Its the way the system works for people who don't have many stories that hit the front page. This particular person has a 13% popularity rank as opposed to the 27ish of MrBabyMan. For fairness, this person would require less Diggs/Comments to reach the front page.
If you don't like it, quit bitching and leave.- gannondork, on 05/25/2008, -1/+2Yeah!
http://img135.imageshack.us/img135/3932/gtfo3cr.jp ...
- gannondork, on 05/25/2008, -1/+2Yeah!
- PhilLesh69, on 05/26/2008, -1/+1She is referencing a story from page A1 of the Washington Post. I read it in the paper this morning.
Here's the online copy:
http://www.washingtonpost.com/wp-dyn/content/artic ...
You need to provide a (fake) email address and password to get access to articles on the Wapo site.
- twiztidsinz, on 05/25/2008, -2/+8Its the way the system works for people who don't have many stories that hit the front page. This particular person has a 13% popularity rank as opposed to the 27ish of MrBabyMan. For fairness, this person would require less Diggs/Comments to reach the front page.
- SpykerSpeed, on 05/25/2008, -32/+54The government takes more in taxes than Exxon takes in profit. And they don't do anything to earn it.
- obelisky, on 05/25/2008, -21/+7you are dense
- Gimpishi, on 05/25/2008, -7/+8Nope, you are just immature...
- misconstrued, on 05/25/2008, -2/+6He is right.
- vertigoblue, on 05/25/2008, -6/+30the taxes pay for roadwork and highway patrol...
- cswake, on 05/25/2008, -4/+4Those are state-funded.
- MikeFallopian, on 05/25/2008, -2/+5A good chunk of the oil industry taxes are levied at the state level.
- Neoanarchist, on 05/25/2008, -1/+1MADD, the special interest group, asked Nixon (a true conservative) to increase the legal drinking age, federally, from 18 to 21. He, being a Republican (not a neo-con), believed it should be a state choice. However, in order to reckon with the powerful media presence MADD was generating around the issue, Nixon offered states large amounts of incentives in the form of transit funding in order to maintain roads and build new ones. I don't know how much money is given, but it can be reasonably inferred that it is a large amount because every state accepted the money and thus raised their legal drinking age from 18 to 21. As far as I know, the federal drinking age is still 18.
- Neoanarchist, on 05/25/2008, -1/+3Damn, you'd think 5 minutes would be long enough to revise a comment. Based on further reading, here is what I've found.
MADD, the special interest group, asked Regan (a true conservative) to increase the legal drinking age, federally, from 18 to 21. He, being a Republican (not a neo-con), believed it should be a state choice. However, in order to reckon with the powerful media presence MADD was generating around the issue, Nixon offered states large amounts of incentives in the form of transit funding in order to maintain roads and build new ones. I don't know how much money is given, but it can be reasonably inferred that it is a large amount because every state accepted the money and thus raised their legal drinking age from 18 to 21. Also, It appears that the grants offered as part of the multiple amendments made to the Surface Relocation Assistance Act of 1984 during the year of 1984 (ironically enough) would penalize states 5 to 10% for not enacting a legal drinking age of 21. As far as I know, the federal drinking age is still 18, I've also read it has been changed to 21 though.
Essentially the same, however, my memory was not right when it came to a few key facts. - PhilLesh69, on 05/26/2008, -0/+1I was going to say, MADD was founded in 1980.
- mike17032, on 05/26/2008, -0/+1Where do diggiots get the idea that all roads are state funded? Nothing could be further from the truth.
Not only does federal money cover a lot of road work, they even give out grants that pay for some of the troopers that patrol them in some cases.
- Paulish, on 05/25/2008, -3/+5They do a pretty terrible job. The roads where I live are falling apart. But then, it's government, what could I expect?
- p0tent1al, on 05/26/2008, -2/+4Oh you mean the highway patrol that puts the same people that pay their salaries, in jail for smoking weed?
Oh yeah roadwork.....I'm sure that tax money will "eventually" get around to fixing the 9 potholes on my street alone.... I have complete faith.
- cswake, on 05/25/2008, -4/+4Those are state-funded.
- s1mph0ny, on 05/25/2008, -4/+9Don't forget about the tasers, damn things are expensive.
- pintomp3, on 05/25/2008, -4/+6that's because it owns the oil. exxon is just pumping and refining it.
- MikeFallopian, on 05/25/2008, -3/+8Exactly. I love how people complain about high oil prices, and then suggest that the oil industry be taxed more heavily because they make "obscene" profits.
- cquinnd, on 05/26/2008, -0/+3The additional tax you pay at the pump is not a tax on oil industry profits.
- spiffytech, on 05/26/2008, -2/+3You are correct in that, but I think what Mike is suggesting is that the oil companies would just pass the tax burden on to the consumer's fuel cost. Taxation only lowers profits when the company stands to lose by passing the burden on to the consumer, which the gas companies don't. Also, even supposing the oil companies didn't pass the tax on, it would do little to deter their excessive profit margins unless the tax rose proportional to the price of fuel. A flat tax would just be another deduction on their bottom line like every other expense.
- cquinnd, on 05/26/2008, -0/+3The additional tax you pay at the pump is not a tax on oil industry profits.
- OriginalReplica, on 05/25/2008, -7/+4Don't do anything to earn it??? Did you forget about the multi trillion dollars oil war we are fighting right now? Have you notice how high the profit margins for Exxon and other oil companies have jumped since that started?
- mike17032, on 05/26/2008, -0/+1How much oil have we gotten from this magic "oil war" you speak of?
- jdh358, on 05/26/2008, -0/+1Um - I believe the troops are "earning" that. Not the Gov. They just send them.
- DestroyFascism, on 05/25/2008, -2/+4The government takes more in taxes than Exxon takes in profit. And they don't do anything to earn it.
The Government has to pay for roads. And they went to war to protect it. (Which means you pay for it 6 times over)
I Am glad I am not Living in the US and paying tax for war to protect Oil, paying a tax for a Government that is out of control and paying tax on tax for Fuel.- PhilLesh69, on 05/26/2008, -0/+1If you live in Europe, you already pay at least 5, 6 maybe even 10 times the amount of taxes for gasoline than we do here in America.
I paid $75 to fill my tank in Hamburg Germany back in 1993. When it cost me around $20 to fill a tank over here.
- PhilLesh69, on 05/26/2008, -0/+1If you live in Europe, you already pay at least 5, 6 maybe even 10 times the amount of taxes for gasoline than we do here in America.
- mpmb, on 05/26/2008, -4/+5Well, let's repeal the taxes ... I'm POSITIVE the oil companies won't raise their prices to fill the gap.
- PhilLesh69, on 05/26/2008, -3/+1Umm, no. The retailers are the ones that make less than the government takes in taxes. The vertically integrated oil companies still make the lion's share of the profits. That is why they make 10 billion a quarter, or 40 billion a year, in PROFITS.
- mojotaker, on 05/26/2008, -5/+2You are an Idiot. Its people like you that bring this country down. If the government doesn't take tax, then how do you expect it to take care of its responsibilities. I don't like paying taxes just like any other person, but i love this country. Because one part of the system is broken, that doesn't mean you should break another part. You are so dumb, if you hadn't supported that idiot and his minions twice within the last 8 years. then we wont be having the problems we are having now.
Big idiot.
You cant even see what exon is doing. your blaming it your govt. you are really really dumb. ass hole.- Testiculese, on 05/27/2008, -0/+1Easy question, easy answer: The government shouldn't have so many 'responsibilities'.
- obelisky, on 05/25/2008, -21/+7you are dense
- Andytom, on 05/25/2008, -1/+34Link to full story http://www.washingtonpost.com/wp-dyn/content/artic ...
- mike17032, on 05/26/2008, -0/+1Good thing we had to get the huffingtonspams take on it first, I dont know what I would do without reading liberal propaganda 10 times a day on digg from that ***** useless site (put there by the same diggiots that bitch and moan about fox news no less).
- franksalvo, on 05/25/2008, -11/+14So much for free market enterprise.
- Paulish, on 05/25/2008, -0/+10Free market? Does anyone seriously believe the US has open free markets?
- positron, on 05/25/2008, -5/+4While it's true that we don't have a truly free market, I don't see what that has to do this. Nobody forced them into this situation. These people signed franchising contracts with Exxon. They knew what they were getting into, or should have known. After their contract is fulfilled they're always free to find a different franchise or go independent.
- spiffytech, on 05/26/2008, -1/+3The guy in Virginia has been doing Exxon work for 20-30 years, the article said. There wasn't tight control over his stores then.
- consonance, on 05/25/2008, -14/+28Those poor oil companies! It's not their fault that gas prices are so high; they're trying to keep up the same as Regular Joes like you and me!
What's that, you say? They're enjoying record profits? Completely unrelated!- thelastcivilian, on 05/25/2008, -6/+92+2=5
- CiXeL, on 05/25/2008, -5/+5i was thinking.
you know how some fast food places like subway sometimes will illegally say you have to buy $10 worth of items to use a credit card?
the reason for that is because they want your purchase to justify the price they get charged for the credit card transaction.
what i want to know is, how much are they getting charged for that credit card transaction?
or..
how little gas would i have to buy to make them LOSE money on the transaction?
so i could top off with a few dollars here and there and they would lose money doing business with me.
also say YES to the receipt EVERY TIME so they lose money on paper receipts as well.
i just had to pay over four dollars a gallon for gas, and i want to know, how can we hurt THEM?- nobeastsofierce, on 05/25/2008, -3/+5illegally? What law says stores have to accept credit cards?
- CiXeL, on 05/25/2008, -2/+4visa states on their website that credit cards are to be used just like cash. it is part of their contract. if a store requires a minimum you can actually report them to visa and they will force them to comply.
- BesideYouInTime, on 05/25/2008, -2/+2This is actually false. A local store had a minimum purchase amount and I reported it to VISA, who didn't do squat. In fact, they told me to contact my own credit card company and complain (What is CapitalOne going to do?)
- lotu, on 05/25/2008, -0/+2Well that's contractual issue rather than a legal issue. Yes they are close but they are different. Also it is very possible the large cooperations have the ability to negotiate a better deal from visa.
- itsthebrod, on 05/25/2008, -0/+6@BesideYouInTime
No, minimum purchase amounts ARE against Visa requirements, you just have to report the matter to the bank who issued the credit card (who has the power to file the complaint formally) and not just Visa in general.
- nstanosheck, on 05/25/2008, -2/+6Except you would be hurting the franchisee, not the oil companies. And the requiring a $10.00 purchase to use a credit card is NOT illegal in most states.
- CiXeL, on 05/25/2008, -3/+3down the street there is a gas station that has higher prices than everyone else. it is a greedy owner.
honestly i could care less about the franchisee. thats not my problem.
if we hurt the franchisee they scream at the credit card companies for their fees or the oil companies for their prices both of which i think is a good thing.
and YES it is illegal to require a minimum transaction. go ahead and call visa if you dont believe me. if you notice most stores that do that only do it for a short period of time before someone who works for visa or knows better comes in and reports them.
they have to comply by the terms of their contract agreement or are no longer able to do visa transactions. - PhilLesh69, on 05/26/2008, -0/+3CiXeL,
The owner charging more is either a very bad business man, has a very unfavorable contract with his supplier, or has some magically favorable factors allowing him to charge more.
Unless he happens to be on the most heavily trafficked corner and his competitors are in hard to get to places due to traffic patterns, which could allow him to charge more, he is turning away a large amount of business in order to make a slightly higher margin.
By the way, it is not ILLEGAL to require a minimum charge. It is a violation of a contract between two private entities. There are no LAWS regulating that (maybe some random state might have a law, but overall, no laws regulate this)
- CiXeL, on 05/25/2008, -3/+3down the street there is a gas station that has higher prices than everyone else. it is a greedy owner.
- scotticus, on 05/25/2008, -1/+5I don't know for sure, but your scheme will probably just end up hurting the proprietor, and not Exxon corporate.
If you want to hit them where it hurts, drive less and use public transportation or your legs.- CiXeL, on 05/25/2008, -3/+2sorry, not an available option in miami. extremely poor public transportation infrastructure + unsolved hit and runs are common here. riding a bicycle is taking your life in your hands. i'll screw the gas stations instead.
- marx2k, on 05/25/2008, -2/+2That's got to really suck, living in a place where your only option is your car. What do you do when your car breaks down?
- CiXeL, on 05/25/2008, -0/+1marx2k, thats the way it is for most of the country.
when your car breaks down you take a day off work (which if youre an IT contractor like myself, means no pay) and pay a few hundred dollars (a decent chunk of my paycheck) to have your car fixed. or you wakeup really early and your significant other drives way out of her way to drop you off at work and then drives back to go to her work. and even then sometimes it takes more than a day to fix your car. - scotticus, on 05/26/2008, -0/+1As gas gets more expensive, public transportation will have to get better. You'll also find people making more of an effort to live closer to work.
- CiXeL, on 05/26/2008, -0/+1living closer to work requires job stability. that would have to change first.
- scotticus, on 05/26/2008, -0/+1sure, or we'll all turn into renters (which is a safer bet these days anyway).
- flip2trip, on 05/25/2008, -0/+3Visa, Mastercard and Discover typically charge 3 to 4%, American Express charges 7%.
- scotticus, on 05/26/2008, -0/+1There's a minimum charge though right? Isn't it like 25 cents?
- PhilLesh69, on 05/26/2008, -0/+2It varies based on which bank you use for your processing, and the amount of sales you do in a month, your risk (are you an entirely "card not present" business, like an online retailer) but basically it costs between 25 cents and $2 for the "network connect fee" (like an ATM fee) and then anywhere from 1/4 percent to as much as 5 or 6 percent of each transaction.
If you do this, you are only screwing a small business owner, not Exxon. Only 10% or less of Exxon stations are corporate owned. You should have read the article, it explains all this. It explains that only 8 cents is made in profit by the station owner -- not the corporation, who being vertically integrated, is getting the biggest slice of the cost of gas. I'm guessing well over a buck.
- nobeastsofierce, on 05/25/2008, -3/+5illegally? What law says stores have to accept credit cards?
- p0s3r, on 05/25/2008, -12/+15Exxon is the worlds FOURTEENTH largest oil company in the world. 14th. 94% of the worlds oil supply is controlled by foreign nations. Exxon buys 90% of it's oil from other companies. Yeah, it's their fault that for 30 years the enviro-whackos have forced America overseas for oil.
Further, Exxon has operating expenses of 300B/year. How much money do you think a company should earn that spends 300B/year?- consonance, on 05/25/2008, -4/+7Your argument does not make sense. You're saying that Exxon deserves huge profits for spending large amounts of money? I can understand that buying oil from other countries can be expensive, but why does that entitle Exxon and the like to huge profits?
Notice I'm talking about profits. Profits equals revenues minus expenses. Despite spending 300B/year, as you say, which companies continue to have record-breaking quarterly profits? Exxon Mobil, Shell, Chevron, and ConocoPhillips. Are you saying that the more a company spends, the more they're entitled to rip off consumers? When a company makes 40B/year in profit, you're going to defend them simply because they spend a lot?- p0s3r, on 05/26/2008, -1/+4Microsoft profits $15B a year but only spends $50B. Why are they out-of-bounds?
Is there some magic ceiling that says a company can only make this fixed amount of cash? What if a company spends $1T/year?
Exxon's profits are 8-10%. Near the bottom of all industries nationally. I don't find that obscene. - LoCoPyRo, on 05/26/2008, -0/+2Incase you've missed the memo the goal of a company is to make a profit. They are going to 'rip off' customers as much as they can get away with.. its how a free market economy works. I also hope you are considering the gas stations the customers and not the end user, because strategies like this are only affecting them and not you.
- pbd1637, on 05/26/2008, -0/+1Also, please remember that oil is a commodity. If Exxon buys it at one price and the the value of the commodity goes up, they are going to make a profit.
Simply buying high and selling higher. There are oil speculators who actually have nothing to do with the oil industry. They too are driving up the cost of oil, but nobody says any thing about that.
"BIG OIL" is just propaganda by the left.
- p0s3r, on 05/26/2008, -1/+4Microsoft profits $15B a year but only spends $50B. Why are they out-of-bounds?
- brad3378, on 05/26/2008, -2/+4You should also mention that Exxon's profit margin is only about 10%
(scroll to the bottom to verify) http://finance.google.com/finance?q=exxon
In other words, if Exxon reduced their prices by only 11% they would be losing money.
(yes I realize this is an oversimplification, but you get the idea)
If you want a company to get angry at, try getting mad at Petro China
http://finance.google.com/finance?q=NYSE:PTR
Their profit margin is more than double that of Exxon at 20%
Does Exxon still sound evil?
You also may find it interesting to note that the world's richest man (Warren Buffet) has been invested billions in Petro China yet he donated towards the campaigns of the Democrats who are pushing this windfall profits tax on competing American Oil companies.
- consonance, on 05/25/2008, -4/+7Your argument does not make sense. You're saying that Exxon deserves huge profits for spending large amounts of money? I can understand that buying oil from other countries can be expensive, but why does that entitle Exxon and the like to huge profits?
- mooseontheloose, on 05/25/2008, -5/+5So what, really? I don't understand why people act all indignant like the oil companies owe us anything.
If people REALLY gave a ***** they'd start cutting back on their consumption.- CiXeL, on 05/25/2008, -1/+4theres only so much you can cut back on your consumption before you cant drive to work anymore.
i do an hour each way. many people in the country are in the same boat.
most cities have no decent public transit.
i sure as hell didnt go anywhere this memorial day weekend and i didnt know anyone else who did either.- p0s3r, on 05/25/2008, -7/+3Move closer to your job. Stop being so selfish and hurting the environment so you can selfishly live in the suburbs.
- CiXeL, on 05/25/2008, -1/+4the only reason most people such as myself live further away from their jobs is because they cant afford to live any closer to the city centers where the jobs are.
the other thing is, with mergers and layoffs the idea you will never ever have to drive to a job in a different location is a joke or a gamble you will inevitably lose.
clearly you either do not live in the US or are wealthy enough where you arent subject to the average middle class lifestyle thus making your opinion irrelevant. - marx2k, on 05/25/2008, -5/+1For those giving excuses for living far from their jobs..
If you can't afford your current mode of living while living downtown, downsize. If you've got a large family, how did you manage to paint yourself into such a corner, driving an hour to work? How did you choose your living location without considering a viable public transportation system? Was it just "I can get X sq ft for $Y and that deal is awesome so I will take it? - CiXeL, on 05/25/2008, -0/+2marx2k, when i lived in LA i was paying $1175/mo for 650 sq ft and that was with a hour commute to work. i knew i had to leave LA when i talked to all my coworkers working at the aerospace company i was working for and they were all doing 2 hour commutes. I even had a boss at another company who did a three hour commute because he wanted a decent sized place to live in and had a family.
financially, things got alot better for me when i moved to miami.
all i want is to not have to live in a tiny little postage stamp sized apartment and be able to have a reasonable commute and make a reasonable amount of money.
i havent had a vacation since 2003 because in IT if you are sick or need time off (like to visit your family on the holidays) its coming out of your pocket.
last christmas i went 10 days without pay and had to pull out of my savings in order to see my own family for christmas and that didnt even include the price of the plane ticket.
still i think im luckier than most. - p0s3r, on 05/26/2008, -1/+1Live more within your means instead of in luxurious suburbs. Don't punish the earth because you want to live lavishly and outside of your means.
There are plenty of IT jobs that aren't in major metropolitan areas. Go find one of those. - CiXeL, on 05/26/2008, -0/+1theres nothing luxurious about our suburbs here in miami. just trillions of condo complexes that all look alike and connected townhouses.
if you want to avoid punishing the earth, stop the flow of immigration into miami from haiti and cuba that is causing uncontrolled population growth. 36 people arrive at the same spot on key biscayne every week by traffickers and the coast guard is doing nothing about it.
in addition these same people who immigrate here in their minds nature = poverty. this is why they keep pushing the urban development boundary into the everglades. the same people tearing down rainforest are now in control of miami. were there not a national park boundary it would all be pavement.
most americans dont know whats going on down here, they just keep moving away because they feel theres nothing they can do about it because they'll be called racists if they try to fight it.
also good paying jobs here are few and getting fewer. corporations are realizing the workforce is getting less and less skilled as americans move out and are replaced by poor immigrant laborers. we may have to move eventually anyway. we'll just have to see.
i just watched half of one of my favorite places in the everglades called chekika burn to the ground because they arent allowing enough water into the everglades and it gets so dry that it catches fire. this is what was lost:
http://farm1.static.flickr.com/145/432963714_2fddd ...
http://farm1.static.flickr.com/169/432965806_11514 ...
http://farm1.static.flickr.com/145/432966444_28657 ...
some of it may still be there but right now the location is closed and i'm not sure when it will be publicly accessible again.
the everglades is the only national park that was raped before it was handed over to the US government.
- CiXeL, on 05/25/2008, -1/+4theres only so much you can cut back on your consumption before you cant drive to work anymore.
- LoCoPyRo, on 05/26/2008, -0/+5Record profits.. and record expenses.. the article lists their EARNINGS, not profits, there is a huge difference. They make almost the same profits as they did 10 years ago
- brad3378, on 05/26/2008, -0/+1confirmed:
http://finance.google.com/finance?q=exxon&hl=en
(scroll to bottom)
- brad3378, on 05/26/2008, -0/+1confirmed:
- mike17032, on 05/26/2008, -0/+2Adjust their profits for inflation, and its not a record. They also sold more gas than the year before, but god forbid they make more money from doing so.
Their profit margin is about half what most industries enjoy. If you removed every cent that Exxon makes from the price at the pump, most people wouldnt even notice the difference in cost. The US enjoys the cheapest gas in the world.
But feel free to ignore all of this, we know diggtards hate facts that get in the way of their communist rantings about evil big profit driven companies.- petska, on 05/26/2008, -0/+1"The US enjoys the cheapest gas in the world."
That is a load of crap
They pay 8 cents a liter in Venezuela
China, Malaysia, India, Syria, and almost all of Asia have government price controls on gas and energy prices. They subsidize gas for their citizens so its much cheaper than what US drivers pay.
Do a little research on the subject.
- petska, on 05/26/2008, -0/+1"The US enjoys the cheapest gas in the world."
- mfc5200, on 05/25/2008, -14/+14So re franchise your store and buy generic gasoline from wholesalers instead of buying Exxon fuel. There problem solved. Stop bitching about choices you make.
- Mothrog, on 05/25/2008, -0/+12She doesn't own the store or the land, hence the lease.
- ChillEnt, on 05/25/2008, -4/+3...or stop owning a gas station...
Don't place your financial foundation in something that isn't profitable. - knowitman, on 05/25/2008, -0/+4That's what my uncle did with his gas station. It now costs him more to buy gas wholesale then the station across the street salles it for.
- ZenPirate, on 05/25/2008, -6/+16 Maybe gas staion owners should Unionize :D
Go Go Teamsters !! - Barackalypse, on 05/25/2008, -5/+63Blogspam, buried. Send your traffic to the people who actually wrote the story: http://www.washingtonpost.com/wp-dyn/content/artic ...
- llama5492, on 05/25/2008, -14/+24Exxon Mobil earned $1300 a second in 2007. Probably more now.
(source: http://money.cnn.com/2008/02/01/news/companies/exx ...- bobcrotch, on 05/25/2008, -8/+11Yeah that 8% profit is just... just... EVIL AND BAD
- userperson, on 05/25/2008, -6/+78 whole percent! those greedy bastards! /s
- youareretarded, on 05/25/2008, -5/+5If the country was forced to buy my product I'd gladly take a 2% profit margin.
- bjornski, on 05/25/2008, -3/+1No kidding, me too.
- p0s3r, on 05/26/2008, -2/+5Show me the law that says you must buy only Exxon gasoline.
- p0s3r, on 05/25/2008, -6/+4Exxon Mobile also spends over $13,000 per second.
- haydesigner, on 05/25/2008, -4/+3"Exxon Mobile also spends over $13,000 per second."
[citation needed, because we don't blindly believe the CEO of Exxon, like you apparently do]- p0s3r, on 05/26/2008, -2/+6Look that their ***** financials like I did. No secret there. They spend over 300B in total. Grab a calculator.
- haydesigner, on 05/26/2008, -2/+1Then give the ***** link to their financials then, which is WHAT I ASKED FOR. Or can't you read?
- p0s3r, on 05/26/2008, -2/+3Are you really that stupid that you don't know how to find a publicly traded company's financial statements? If you're too ignorant to find them, you're definitely too ignorant to understand them.
- haydesigner, on 05/27/2008, -1/+1Einstein, I asked YOU where YOU got YOUR info.
- haydesigner, on 05/25/2008, -4/+3"Exxon Mobile also spends over $13,000 per second."
- Scheissen, on 05/25/2008, -1/+4Government steals twice as much as that per second from oil being sold in America.
- bobcrotch, on 05/25/2008, -8/+11Yeah that 8% profit is just... just... EVIL AND BAD
- Trubacca, on 05/25/2008, -6/+9Ahh good times in ExxonLAND. If only there was some part of the oil industry that WASN'T full of lies and corruption. I can only pray that we break our oil addiction before it corrupts our very souls!
- mooseontheloose, on 05/25/2008, -7/+6Those *****! How DARE they maximize their profits at your expense? And here I thought they were non-profits dedicated to offering the lowest priced gasoline they could. If only they were more altruistic like Micros... err, Best B... err, Toyo- what, you mean all businesses do the same thing? Never mind.
- benecere, on 05/25/2008, -1/+4If you are going to use what is obviously objectivism to make a point, (though, I don't think it holds up under scrutiny) you need a better victim for making a case. Exxon has been guilty of fraud, dishonest business practices, etc etc. which puts it on the looter side of Rand Town.
That is the chief flaw in Objectivist principle. These virtues are its spine, yet there is nothing that will self-correct when the feces rather than the cream rises; and eventually it always does.- mooseontheloose, on 05/25/2008, -2/+2a) So rail on them for that, not for raising the price (like every other company has done)
b) That's the government's jobs. Blame them for not doing more, not the company for engaging in legal competitive business practices. - benecere, on 05/25/2008, -0/+2Moose: I am not railing, actually. I was, more or less, stating that ExxonMobil is awash in historic activities that exempt it from any pure Objectivist stance of morally "deserving its profits because of honestly earning them". It's unclear to me to what extent Exxonmobil ought to hold full power to regulate its own profits since it both lobbies heavily and accepts money from Governmental sources. I distrust those who are prone to playing both sides against the middle. All the underlying information is curiously opaque. Cable companies do the jump-roping thing "Now I'm Government"/"Now I'm Private".
On point B, it certainly wouldn't be the Government 's job from any Objectivist standpoint. As a matter of fact, its NOT being the Government's job is the whole, entire Rand package. (Where the scornful utterance of the word altruism originates) This is where people confuse me; they, too, want it both ways. As as said, Objectivism affords no method to assure the "cream will rise" and it is based on that assumption. Government enforced Objectivist Economics is an oxymoron.
- mooseontheloose, on 05/25/2008, -2/+2a) So rail on them for that, not for raising the price (like every other company has done)
- benecere, on 05/25/2008, -1/+4If you are going to use what is obviously objectivism to make a point, (though, I don't think it holds up under scrutiny) you need a better victim for making a case. Exxon has been guilty of fraud, dishonest business practices, etc etc. which puts it on the looter side of Rand Town.
- mooseontheloose, on 05/25/2008, -7/+6Those *****! How DARE they maximize their profits at your expense? And here I thought they were non-profits dedicated to offering the lowest priced gasoline they could. If only they were more altruistic like Micros... err, Best B... err, Toyo- what, you mean all businesses do the same thing? Never mind.
- moolaismyfriend, on 05/25/2008, -15/+6some one call the waaahbulance
I don't care.- sockpuppets, on 05/25/2008, -3/+10Then shut the ***** up and don't comment.
- reepax, on 05/25/2008, -1/+10and if she lowers the prices, they double their wholesale price
- PhilLesh69, on 05/26/2008, -0/+1I doubt they'd double it.
In fact, that is one place where they do help out the franchisee, if they have a competitor undercutting them, they will lower the wholesale cost accordingly.
But, then again, that is the point. They have controlled the wholesale costs so tightly that they keep the station franchisees within the tightest margins.
- PhilLesh69, on 05/26/2008, -0/+1I doubt they'd double it.
- kenvsryu, on 05/25/2008, -2/+7http://www.google.org/recharge/
- DaDrake, on 05/25/2008, -7/+2720-30 years ago, the USA had a chance to broaden its energy sources as well as be more independent on foreign oil (by drilling here). We didn't prepare and now we are paying the price right now.
There is no blame on the oil companies... it's simply supply and demand.- JoeHague, on 05/25/2008, -6/+2I Digg it. Theres nothing immoral about making record profits. When people start using less (not just in their cars but in all aspects of life) the price will go down.
- unreg, on 05/25/2008, -0/+7Actually it is no longer supply and demand. It adequate supply and an unreasonable fear that demand won't keep pace.
Oil prices have doubled in the past year. Has demand doubled? How much did it actually go up? 2-3% tops? Have we seen shortages? Our weekly stockpiles still seem to be "average" for the time.
Oil jumped $9 last week. Based on what tangible reason?
- bravo1995, on 05/25/2008, -0/+8"Oil jumped $9 last week. Based on what tangible reason?"
Speculation. The idea that oil's gonna hit $200 a barrel soon, so let's invest in futures and make it a self-fulfilling prophecy. - PalmerEldritch, on 05/25/2008, -6/+1I'm guessing that the US Military in the past few years has driven demand of oil quite a large way up. Doubling the US usage would not surprise me at all.
- unreg, on 05/25/2008, -0/+2It would me
- flip2trip, on 05/25/2008, -1/+3Actually oil usage in the US has gone down over the past year. The problem is oil is traded on the world market and China is developing so fast their consumption is rising proportionally.
- unreg, on 05/26/2008, -0/+2But Chinas growth has been a factor for several years now. It's not like its a surprise or something.
- bravo1995, on 05/25/2008, -0/+8"Oil jumped $9 last week. Based on what tangible reason?"
- dralezero, on 05/26/2008, -0/+1Who killed the electric car? We had one. Nobody wanted it.
- Room101, on 05/25/2008, -11/+8Just to play devil's advocate--and I'm sure I'll get dugg down for this--but if Exxon is keeping Rezazadeh from raising the price on the gas I pay for, why is that evil? Isn't Exxon supposed to be the one gouging me?
Maybe all of this attention to the idea that the oil companies are gouging us has given them an incentive to make sure that stations don't raise the price, and feed further into the idea of gouging?- benecere, on 05/25/2008, -1/+3I really think it's more an issue of the control they have. I'm less appalled with WHAT they are doing than with HOW they are doing it,
Big Brother is Big Brother no matter from which corner he emerges. - bravo1995, on 05/25/2008, -1/+2You're basically right. This is how franchising works. If one rogue Subway decides to sell sandwiches for $12 bucks apiece, it may be good for that store, but it's bad for the consumer and for the Subway name. It's the same with gas stations.
All the same, maybe they ought to let them run on slightly higher profit margins, while maintaining the same principles. If individual stations can't afford to stay in business, Exxon needs to lower their wholesale price (or let individual stations raise theirs). - lotu, on 05/25/2008, -0/+1Yep I agree with you and bravo if Exxon is over charging the franchisee and driving them out of business. They will lose money and either change things or go bankrupt. That just simple economics.
- benecere, on 05/25/2008, -1/+3I really think it's more an issue of the control they have. I'm less appalled with WHAT they are doing than with HOW they are doing it,
- Krakerjax, on 05/25/2008, -4/+3If a gas station owner wanted to make a point then couldn't they, at the sacrifice of money, set their gas prices to really low?
- marx2k, on 05/25/2008, -0/+1I'm sure franchisees, who support families, are more than willing to drop everything and screw themselves in the ass to make a point.
- marx2k, on 05/25/2008, -1/+0what the *****,,,
> 0 Replies -- best has -infinity diggs
Do I win a prize for spotting this or something?
- URnotheonly1, on 05/25/2008, -12/+9WHY IS GAS $2.90 A GALLON IN CHINA AND $1.36 A GALLON IN IRAQ
Next time you fill up please write this question on the gas pump. (use magic marker)- dpratt, on 05/25/2008, -3/+18Because the demand for oil in Iraq is per capita a fraction of what it is in the U.S. Also, the supply of oil in Iraq happens to be local, and thus doesn't need to be shipped halfway across the world.
Why can I get a good deep dish pizza in Chicago for a quarter of what it costs to have one shipped to Austin?
I'd be willing to bet that the answer is pretty much the same for China, except that since they're Communist, they more than likely have price controls, and also the associated shortages and rationing.- URnotheonly1, on 05/25/2008, -8/+1well then I want price controls too, seems to be working for them. 10% growth
- MaskedSlacker, on 05/25/2008, -1/+9You are an idiot. Ask Nixon what happens when you place price controls on oil.
Oh right, they don't work.
- MaskedSlacker, on 05/25/2008, -1/+9You are an idiot. Ask Nixon what happens when you place price controls on oil.
- Donwangugi, on 05/25/2008, -0/+2Its easier to grow from 7 trillion with 1.6 billion people than it is to grow from 14 trillion with 300 million people.
China does freeze its gas prices, and they can do it economically because demand increases so fast oil suppliers do not feel the pain. Also China, still, uses a lot less oil than us, because they, believe it or not, have fewer cars.
- URnotheonly1, on 05/25/2008, -8/+1well then I want price controls too, seems to be working for them. 10% growth
- gobbleplex, on 05/25/2008, -2/+161 USD = about 7 Yuan
1 USD = about 1200 Iraqi Dinar
Iraq's per capita income is in the neighborhood of 1000 dollars per year. if they buy gas for 1.36 per gallon, you'd have to wait until it were about $120 per gallon before you have a basis for comparison. China's is about 6000 dollars per year. at 2.90 per gallon, you'd have to wait until we are paing $20 per gallon to have a basis for comparison. - trixterIreland, on 05/25/2008, -0/+4because the chineese government pays part of the cost. In iraq its more a matter of there arent as many shipping charges, export taxes, etc. At the start of all of this it was 90 cents. The fact that iraqi oil isnt coming to the US is just indicative of the fact that we didnt go there to steal the oil.
Now here in Amsterdam its 1.55€/litre or about $9.00/gallon. Now there are subsidies just as there are in the US, without the 70% tax on gas its slightly cheaper than china, however I do not know how much the subsidies are. I wrote more on subsidies in its own thread. - CoolSilver, on 05/26/2008, -0/+2Chinese currency is based in the US dollar. With a weak dollar affects them dramatically as well.
- Testiculese, on 05/27/2008, -0/+2Gas in Iraq was 3 cents a gallon until us assholes showed up.
- dpratt, on 05/25/2008, -3/+18Because the demand for oil in Iraq is per capita a fraction of what it is in the U.S. Also, the supply of oil in Iraq happens to be local, and thus doesn't need to be shipped halfway across the world.
- valleyguy, on 05/25/2008, -4/+5further proof that corporations are soul-less entities. they couldn't care less about people - the bottom line is at stake
- sockpuppets, on 05/25/2008, -5/+4How could you have joined digg on December 10th, 2006 when you apparently were just born yesterday?
- userperson, on 05/25/2008, -1/+3well ... yeah.
Exxon isn't your mommy, your daddy, or your friend.
You can be friends with people who work at Exxon, but Exxon is a corporation, it doesn't exist, it cannot be your friend. They will want to sell you stuff, but you don't have to buy it.
Assuming they aren't using direct-violent-force against anyone, it's Exxon's responsibility to do what its shareholders want which is likely maximize profits. - gquaglia, on 05/25/2008, -0/+1The world of Robocop and OCP is nearly upon us.
- Cerius, on 05/25/2008, -10/+19Despite what the article says, Exxon's profits are not a result of monopolistic powers, but of sheer size. Their profit margins are low, but they are enormous companies so they make enormous amounts of money. This move is simply made to make up for losses in the purchase of crude. Many American oil companies have to buy enormous amounts of crude, and like everyone else they are feeling the power of the speculators in the oil exchanges. The bad guys are not the oil companies, but the speculators who know they can continue to drive the price higher and higher with massive speculation all the while making a large profit.
The democratic proposal seeks to limit pension funds and sovereign wealth funds from becoming involved in commodity exchanges like they are now so that what we see now is never experienced again.
If you think it is the oil companies doing this then you need to do some more research. - Shaman760, on 05/25/2008, -4/+9SO drop the prices to $1.33/gal. Give the bean counters a heart attack.
- otbeverly, on 05/25/2008, -6/+40In capitalist America, oil company drill you.
- URnotheonly1, on 05/25/2008, -3/+4nice!
- p0tent1al, on 05/26/2008, -0/+3comments like this make digg that much of a better place
- trixterIreland, on 05/25/2008, -5/+7these are not really record profits they are the same numbers more or less that they have been getting. Why I recall late 2002 early 2003 when gas was under $1.50 in los angeles that exxon posted a $11B profit. What you need to really look at is the profit margin though, not the total profits. The profit margin is the percent of the sale that is profit. Its about 10%, its just that they are doing over a hundred billion a year in sales (still less than microsoft which does something like $100M/day globally, and at a 25% or so profit margin).
- LordPhilMil, on 05/25/2008, -8/+3Gas is so High for a lot of reasons. One of the recent ones is that due to the disaster in China, our oil refineries (which are already at 100%) are making more diesel to sell to china to operate there rescue and digger equipment. This takes away some of the % these refineries were using for gas, and this adds to the gas trouble here. And because alot of the diesel is being sold to China, our diesel goes up.
- unreg, on 05/25/2008, -2/+1-The weekly refinery utilization rate is about 87%
-The China earthquake is just another ruse to deflect the real reason prices have shot up, greed. You really think the Chinese are operating that much equipment? What about all the equipment not being operated? - LordPhilMil, on 05/25/2008, -0/+1Good points but then again, you can't just flip a switch and *bam* your refinery just starts pumping out more oil. I do believe I read somewhere were the reason for some lower utilization values could be attributed to a variety of things such as maintenance (apparently oil refineries use lots of pipes!) and some sour crude coming in.
Secondly, as state above the profit margin isnt that high, so greed isn't really viable here now is it? I mean, if they were being greedy wouldn't there profit margin blow other companies' out of the water? And the Chinese are operating equipment, just because it's not all of theres (surprise there huh?) doesn't mean that the amount they are operating has no effect.
- unreg, on 05/25/2008, -2/+1-The weekly refinery utilization rate is about 87%
- highlymodified, on 05/25/2008, -5/+12WHAT?! Oil companies total complete bastards who don't care who they destroy in their successful quest for multibillion dollar profits every month?!?!
Surely you're kidding. - bromac, on 05/25/2008, -1/+10Gas stations don't make money off gas.
They make money off the snacks, cigarettes, beer, or whatever else you buy while getting gas. It's the same thing as being a lottery retailer: you don't make much direct revenue but the customer draw is where the money's at.- RealityMonster, on 05/25/2008, -0/+1Too bad I specifically buy gas at stations that let me use a quick-swipe dongle on my keychain and pay at the pump.
Unless I'm on a road trip. Then going into the station to buy some junk food so I don't feel guilty about using the washroom is totally the way to go.
- RealityMonster, on 05/25/2008, -0/+1Too bad I specifically buy gas at stations that let me use a quick-swipe dongle on my keychain and pay at the pump.
- MM983, on 05/25/2008, -1/+2Pretty interesting article. I buy my gas from this station and I have read the document she posted in the store.
- URnotheonly1, on 05/25/2008, -2/+110% growth. seems to work fine. Gas fuels this economy, without there won't be anything left. I'm wondering if its time to revisit.
Don't blame me, I am only trying to save what the baby boomers didn't give a ***** about. the countries future - randyzaia, on 05/25/2008, -3/+8Exxon Mobil's profit margin is 10.85%. Reduce the price of gas by about $0.50 and there go the profits. Needless to say, people will still be bitching and moaning.
- trixterIreland, on 05/25/2008, -11/+8In the US your federal tax dollars go for subsidies, and now we tread on dangerous ground. Note that no one is proposing doing away with the subsidies, why is that? Remember its CONGRESS *not* the president that passes laws for new taxes (up or down). Its CONGRESS *not* the president that approves the budget. There are 3 senators that are the "big 3" candidates, McCain, Obama and Hilarity. All 3 are currently in a position to propose a bill (and try to get it out of committee) that would change this, none would be able to as president. Why arent they doing something now while they can? hint: so they can blame someone else for it not happening or going wrong later if it comes to that.
They are however proposing that they raise taxes on the oil companies, but in a way that has been tried and failed in the past. Windfall taxes sound innocent enough but they are *retroactive* taxes, taxes that kick in after the money is spent. So in order to pay the tax where does that money come from? You guessed it higher prices at the pump. But its not sold this way to consumers, they are told that its just a tax on those evil massively profiting oil companies, and not on consumers.
The reality is the corporations do NOT pay taxes, yes they remit money but they dont pay it, they pass the costs onto the consumers of their products, who really pay the tax. Increasing taxes will have a direct and real effect of increasing gas prices. Windfall taxes have a more profound effect because of their retroactive nature. It didnt work in the 70s to combat high prices, it wont work now, and largely for the same reasons.
Now lets get back to subsidies, why tax peter to pay paul? There is a cost to tax peter (you), there is a cost to pay paul (big oil), eliminating both sides reduces cost (waste) and makes the same money more available, whether or not that would translate into savings remains to be seen.
Subsidies were started in 1916 largely because the industry wouldnt have been able to survive, or the things that relied upon it, without that (or that was the belief at the time). Now however, 90 years later, that is no longer the case.
Now if the subsidies were dropped, it gets really interesting for some, not so much for others. The cost at the pump would reflect the true cost, not the subsidized cost. This means that you really pay for what you use, and not what everyone else uses. If you only ride a bike, or perhaps take mass transit is it fair that you are paying to lower the cost of gas for trucks driving cross country? What about air planes? What about those kids that keep driving around the street blaring their radio? Yes you are paying for the fuel for these vehicles even if you personally dont buy any gas due to lack of a vehicle, electric car, whatever.
Greenpeace (killer of polar bears and other radical things) thinks that in the US $15-35B/year is spent in subsidies[1]. Others claim that there is a substantial tax deduction system allowed for them[2]. H.R. 5351was to repeal the $18B/year tax breaks given currently to oil companies. This presumably replaces the older 2006 H. R. 5234 which was similar in nature. Neither of these seem to touch the US military protection of oil production facilities and shipping lanes which is reported to cost $19B/year for effectively private security[3].
The reality is that between tax breaks and other things (such as financial help in expanding refineries that are not inside the US jurisdiction, basically paying to let someone else make money and possibly never give anything back to the US) its difficult to tell exactly how large these subsidies are. Most energy is subsidized (I think geothermal is the only one that isnt or at least wasnt historically, the plants in California may be though), oil isnt even the largest subsidy per unit (gallon for example) but it is the largest by volume.
The strategic oil reserve takes something like 70,000 barrels per day, however the american consumption is something like 200k barrels per day. This equates to 20-25% of global consumption (roughly the percentage the US economy is in relation to the world). Some have said 40% but they misunderstood what they were reading, its 40% of the top 12 oil consumers, 20-25% of the planet. The reductions in the strategic reserve will equate to at most a 1 penny shift in prices at the pump (based on the percentage of oil that wont be going there).
While bush has started over the last many years alternative fuel programs (and the air force is the first to run a 100% synthetic jet fuel plane supersonic, other carriers generally use a mix 50/50 synthetic and regular, and have never gone supersonic). There are other programs as well, many of them are subsidy programs, and there is the inclusion for the company that makes oil (not biodiesel, although it is made from animal remains from a slaughterhouse) to get some subsidies, they said that it dropped their price by about $4/gallon of crude!! If that were the case then the actual cost of gas should be closer to $9/gallon in the US, maybe slightly less, and yes it would hurt to fill up at the pump, but you would also be paying less in taxes, and if you dont drive you wont be paying for gas for the people that do drive.
I am now bored, but I do encourage people to google for real facts on how much the subsidies are, which ones exist, and whether or not paying them is really the right thing to do, after all it comes out of tax payer money and does not come from anywhere else.
[1] http://media.cleantech.com/node/554
[2] http://www.ucsusa.org/clean_vehicles/fuel_economy/ ...
[3] http://www.cato-at-liberty.org/2007/01/18/how-larg ...- RyeBrye, on 05/25/2008, -1/+4Get a blog.
- c1nn46, on 05/25/2008, -0/+4a well thought-out response? you must be new here.
- trixterIreland, on 05/25/2008, -0/+2heh and you get a digg for that :P
- trixterIreland, on 05/25/2008, -0/+2heh and you get a digg for that :P
- BraveQuail, on 05/25/2008, -3/+7Stop complaining about the profits of the Oil companies as their profit margins are considerably less than most other industries. They are also slowly beginning to invest more money into alternative energies, although probably not quick enough. Just remember the money they're making and reinvesting is down to how much you spend on filling up your cars.
- anachronaut, on 05/25/2008, -0/+1It is pretty interesting how the oil companies work, where the exact same gas from the exact same truck can vary widely in price to the various retailers, depending solely on their location. It's basically the multinational oil companies dictating local economies.
Are there any other national franchises that operate in this specific manner? I don't eat fast food, but doesn't a Big Mac pretty much cost the same no matter where you buy it?- trixterIreland, on 05/25/2008, -0/+2sorta There are guildelines for the bigmac but for example if you are in the NYC area you will see adverts saying prices are slightly higher in manhattan (largely a rent reason but that isnt the only one).
As for oil, some have tried to break the link between production, distribution and sale. The forced introduction of middlemen has increased the cost when this was done, as any sane person would expect a new middleman would do to an existing relationship. He has to eat too.
Its not just the big oil companies that do this, there are smaller distributors, for example in the Yuma Arizona area that do the same thing, with a twist. They tell you the price you will charge, if you dont charge that, for some silly reason their truck just doesnt have enough gas for you. After a day or two without gas generally the station will adjust its price and suddenly there is gas again. Its a form of organized crime, its price fixing, and generally there are laws against doing that. Proving it is a different matter.
Exxon probably has their bases covered although its questionable that "any additonal profits goto corporate" when its an independant franchise, and it probably wouldnt be hard in an election year with record gas prices to get a hearing on this policy and make a big stink about it. - marx2k, on 05/25/2008, -0/+0Nope, they're different prices for different locations. Most everything is within a franchise. It has more to do with how much can company X to make off of community Y with a certain standard of living vs community Z with a different standard of living.
A $5 cup of coffee might fly in NY but will not in West Virginia - mike17032, on 05/26/2008, -0/+1Big Macs are NOT the same price everywhere.
- trixterIreland, on 05/25/2008, -0/+2sorta There are guildelines for the bigmac but for example if you are in the NYC area you will see adverts saying prices are slightly higher in manhattan (largely a rent reason but that isnt the only one).
- amightywind, on 05/25/2008, -5/+2Squeeze the franchises Exxon and keep paying me that fat dividend. Good job on the stock price too. Why do the liberals complain about prices when they refuse to allow domestic exploration?
- trixterIreland, on 05/25/2008, -0/+2your dividend (and many retirees who rely on it for groceries) is in jeopardy if that windfall tax goes through, typically its a tax that is assessed after dividends are paid, leaving the company short, but if they are prepared for that they may not pay as much. They may not pay anything. The 2nd year of this tax they are certainly going to cut that dividend.
Retroactive taxes like windfall taxes are evil - filmbandit, on 05/26/2008, -1/+1oh -- it's the liberals fault. polly want a cracker?
- trixterIreland, on 05/25/2008, -0/+2your dividend (and many retirees who rely on it for groceries) is in jeopardy if that windfall tax goes through, typically its a tax that is assessed after dividends are paid, leaving the company short, but if they are prepared for that they may not pay as much. They may not pay anything. The 2nd year of this tax they are certainly going to cut that dividend.
- Zecchetti, on 05/25/2008, -2/+2These mega corporations have become monsters that wont stop growing and growing
- p0s3r, on 05/25/2008, -1/+3Good News! The Democrats in Congress want to nationalize our oil industry! All our problems will be solved!
http://digg.com/politics/Democrats_threaten_to_Nat ...- benecere, on 05/25/2008, -1/+1Stop already with the speaking for others by clearly twisting facts into a statement nobody ever made. Rush holds the copyright on that tired and uninspired trick.
You Neocon types couldn't get up in the morning without a formula.
- benecere, on 05/25/2008, -1/+1Stop already with the speaking for others by clearly twisting facts into a statement nobody ever made. Rush holds the copyright on that tired and uninspired trick.
- RyeBrye, on 05/25/2008, -1/+1How is this different from price descrimination?
- trixterIreland, on 05/25/2008, -0/+2I think the phrase you are looking for is price fixing or collusion or many of the other illegal acts. They are not discriminating against a price.
- trixterIreland, on 05/25/2008, -0/+2I think the phrase you are looking for is price fixing or collusion or many of the other illegal acts. They are not discriminating against a price.
- WTFppl, on 05/25/2008, -2/+3I have a friend who owns a gas station with the word "space" in the name. This station has a small, non-corporate, store inside it. The sales of commodity are the main support income for paying the rent, utilities and vendors. The fuel the station sells makes up only a small fraction of the income, as my poor friend only receives profits of .04 cents a gallon. Yet, share holders of certain corporate fuel giants have reaped record quarterly profits, in the range of $30bn+.
Something is seriously wrong here "United States", it's time we do some regulating!- tomis, on 05/25/2008, -0/+1That's pretty much how all franchises work.
- ironsam, on 05/25/2008, -1/+10Exxon's profit margin last quarter was 9.32%, hardly excessive.
- trixterIreland, on 05/25/2008, -1/+4Microsoft is about 25% profit margin. When they were going through their EU trial over here the news was reporting they make something like $100M/day globally in gross revenue. So not only do they have a higher gross they have a higher profit margin on top of that.
Hey! Lets nationalize microsoft, yeah that will solve all the problems :) - gquaglia, on 05/25/2008, -5/+1Not excessive?? Oh yeah
"Exxon Mobil Corp Chief Executive Rex Tillerson's compensation rose nearly 18 percent to $21.7 million in 2007, when the oil company pulled in the largest profit ever for a U.S. company."- brad3378, on 05/26/2008, -1/+3Would you like to comment on Petro China's 20% profit margin being twice that of Exxon's?
http://finance.google.com/finance?q=NYSE:PTR (Scroll to bottom) - mike17032, on 05/26/2008, -1/+5He is running one of the largest companies on earth, why shouldnt he make millions?
Its not his fault you ***** off in life and will be stuck wearing a paper hat forever. And yes, I would like fries with that.
- brad3378, on 05/26/2008, -1/+3Would you like to comment on Petro China's 20% profit margin being twice that of Exxon's?
- diggsethnow, on 05/25/2008, -1/+4And in line with the rest of the S & P 500.
- trixterIreland, on 05/25/2008, -1/+4Microsoft is about 25% profit margin. When they were going through their EU trial over here the news was reporting they make something like $100M/day globally in gross revenue. So not only do they have a higher gross they have a higher profit margin on top of that.
- Roguecop, on 05/25/2008, -1/+2Almost all that profit is going back into exploration and drilling. Unfortunately from the time a major discovery is found to the time it begins to produce oil(or gas) is between 7 and 10 years.The oil companies need that profit just to stay within a laps distance of catching up. The real problem is with Diesel fuel. The demand for Diesel is so great globally that refineries are having to switch away from regular gasoline output to keep up. This is why diesel cost so much more than unleaded. The great industrial booms in China and India are the primary culprit. Brazil and several emerging African nations won't help either. The other factors, of course, are the weakening dollar and the Iraq conflict plus threats of conflict in Iran.
IF the U.S. suffers another major Hurricane or other disaster in the Gulf Coast region this year knocking even a small percent of refinery production off line the results could be well...comical...if you have a morbid sense of humor. We're not just talking ultra expensive gas, we're talking that AND rationed gas. If you have a large gas guzzler, ditch it while you can. Pretty soon you won't be able to give it away.- DigitAl56K, on 05/25/2008, -1/+1"Almost all that profit is going back into exploration and drilling."
Prove it.
Show me one credible document that states that, because I believe that you just made that up. You may submit as evidence any report that clearly shows how the cost of exploration and drilling is accounted as a cost of business, and how profits are re-invested, as well as payments to investors, high-level officers, and Government.
Looking forward to it, thanks!- CiXeL, on 05/25/2008, -0/+1we know where all the profit is going
three words: indoor ski slopes - Roguecop, on 05/26/2008, -0/+2...
OK, go explore for, and then go drill oil out of a deep ocean basin and then come back and talk *****.
You have no idea how much one of those rigs cost to build, to transport, to plant, to pump. You have no idea how much is costs to maintenance, to update, to repair refineries to government clean air specifications. You also have no idea how much R&D cost to get 1) at deeper oil and 2) at oil in fields previously believed to be tapped out 4) oil in porous rock 3) to do it environmentally safely. It cost lots of MONEY, billions annually.
Besides the U.S has had a very cheap ride compared to everybody else when it came to gas for a very long time. Now that ride is over. We are nearing peak oil. And the government and the oil companies really can't do much of anything to help the matter except explore and drill more and develop less mineral energy dependant technologies.
Start messing with the law of supply and demand and everything falls apart. You think your roads are bad now try repealing gas tax or something stupid like that. You'll realize real quick those highways and byways need constant expensive maintenance to stay safe let alone comfortable.
- CiXeL, on 05/25/2008, -0/+1we know where all the profit is going
- trixterIreland, on 05/25/2008, -0/+1actually that isnt that true. While there is some investment I dont have the exact figures handy, I know that google knows them. There are a couple problems finding and getting new oil discoveries though, it can take 10 years from locating it to pumping. But even the exploration stuff is only a small percentage of their total profits.
10 years seems like a long time, but for some reason that is what it takes (and why clinton rejected ANWR, he wanted a fix during his term, even though gas wasnt that bad back then, in 1999 it was $0.90 in NJ for full service, $1.25 in LA for self, and $1.35 in san diego for self 87 octane).
As for diesel, the original diesel engine was designed to run on peanut oil, that got changed. Engines can actually use a 30% soy oil substitute (diesel only) and that actually tends to increase the lifespan of the engine. It would be a 30% reduction in diesel at any rate.
In Brazil they make ethanol for about $0.81/gallon from sugar (590 gallons per acre grown), but to import ethanol into the US incurs a 54 cent tariff, putting it above the $1.05 cost that it takes to make corn based ethanol (400 gallons per acre). Its also illegal to run pure ethanol in your car, why e85 exists.
Looking at these costs to manufacture something that will make your car go vroom vroom you have to wonder a little why its 4 times that much when it gets to the pump and that does not include subsidies! The price difference also does not account for the profits shown by the oil companies, they should be much higher than they are if that were all of it so something has to be missing.
- DigitAl56K, on 05/25/2008, -1/+1"Almost all that profit is going back into exploration and drilling."
- GhostBear, on 05/25/2008, -3/+1***** Exxon
- nixfu, on 05/25/2008, -3/+3Whoever posted this is a clueless retard and knows NOTHING about economics.
- gquaglia, on 05/25/2008, -4/+2When you pay your CEO an obscene salary, the money has to come from somewhere.
"Exxon Mobil Corp Chief Executive Rex Tillerson's compensation rose nearly 18 percent to $21.7 million in 2007, when the oil company pulled in the largest profit ever for a U.S. company." - bty2047, on 05/25/2008, -1/+2say WAAAA?!?!?!??!?!?!?!!?
out of control man!!!!!!!!!!
DATZ CRAZZZZZY!!!!! IM GUNNA POOP ON YOUR FACE!!!!! - pappyblueribs, on 05/25/2008, -0/+2The main question I had was why Exxon is raising the rent so much. A 30% is insane on the surface -- I'm wondering if Exxon is forcing the owner out on purpose.
On that point, I've noticed that all of the Chevrons in my town are charging roughly 10 to 13 cents more than the station across the street. I wonder why, especially after reading this article! - AlaskaLoneWolf, on 05/25/2008, -2/+2I just looooove Exxon, ever since what they did in Valdez. What a great company!?
- richmondphotog, on 05/25/2008, -0/+2I drink your milkshake. More than ever.
- crackberri, on 05/25/2008, -4/+1For decades Dumocrats have blocked the drilling in our country while other countries are laughing how stupid we are as they drill our oil............
- diggsethnow, on 05/25/2008, -0/+1This has got to be one of the worst articles I have read in some time. Exxon Mobil does not raise wholesale gas prices based on what one retailer is selling the gas for. In fact, The worst part of Exxon Mobil's business is the refining and gas business which has been an anchor on company profits throughout the recent run up in crude prices. Anyone who knew anything about Exxon Mobil realize that the stock price has been under pressure in large part because of tight margins on refining and wholesale gas. If Exxon could produce enough crude for its refining process then it would be in better shape, unfortunately they have to buy extra oil on the open market at market price (which they cannot control) to produce the amount of gas they currently refine.
It's amazing that anyone actually writes these trash articles without doing any research into the core Oil and Gas business. Why write about subjects you are not familiar with? Why?
If you want Oil and Gas prices to drop:
1. Use less
2. Make more
3. Convince India and China to stop subsidizing crude costs to their refiners
4. Tell the emerging world they should not come into the 21st century and should abstain from roads, plastics, vinyl etc..
5. Invest in new and existing alternative energies
6. Bring Nuke power online immediately
7. Stop using Oil for energy uses that can be generated from Nat Gas, Solar, Wind, and Nuke.
-
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