From: MV (MV@dc9.tzo.com)
Date: Wed Aug 24 2005 - 18:26:55 PDT
You are right about the little companies being gone.
There is a small gas station with 6 pumps about a mile from my place (I
live outside of a small 1200 population town) and I know the owner well
enough to have a friendly conversation about his business. When he
opened the station about 5 years ago the contract he signed with the oil
company that fills his tanks specified that he had to adjust his pump
prices according to their price instructions within 1 hour after
receiving their phone calls. If he did that they would guarantee him x
cents per gallon profit. (It's actually something like 15 cents per
gallon.) So although he owns the station, store and land, he has no
control over the prices on his pumps. He makes most of his money off
the other things he sells in the store. The gas sales is actually a
minor part of his business used to pull customers into his store.
I've been told that this is common practice with oil distributors.
So who is controlling the prices???
Dave
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
J wrote:
> I think you are onto something, here. If we're going to drive the same
> amount, and pay whatever they demand, then there is no monitary pressure
> to keep prices down, assuming there are only a few players in the oil
> game. Wait! There are! Remember 20 years back when there was the big
> scare that the gas stations were leaking and needed all new tanks? The
> only people that could afford to replace the tanks were big oil
> companyies. Voila. No competition. Jim
>
> MV wrote:
>
>> Good point Randy.
>>
>> I'd like to also point out that the actual cost to remove oil from the
>> ground has actually gone down over the years. The cost to transport
>> the oil from the Middle east to the USA is actually pretty minor.
>> Single digit cents per gallon.
>>
>> The price of fuel has more than doubled in the last few years, and
>> with the production costs staying pretty much the same, this means
>> that some groups have more than doubled their profits on the same
>> exact product. Actually it is probably more like tripled their profit
>> margins.
>>
>> If the rules of supply and demand are actually involved here (I
>> question that) then why should the oil companies try and produce more
>> oil and build refineries. It seems to me that their best course of
>> action would be to cut back on production and let the price of oil
>> rise even further. If the people of the USA don't get upset with
>> $3.00/gallon and more on the west coast, then obviously we haven't hit
>> the critical pain point yet. Perhaps it is around $4.50/gallon??
>> Maybe $5.50??
>>
>> The big oil companies are making record profits. That is, that they
>> are making record profits after doing everything they can to hide
>> their record profits. There is a lot that can be done to hide profits
>> by investing in other companies and acquiring assets.
>>
>> When BP moved in to the US about 15 years ago, the first thing they
>> did was to shut down refineries. There is a huge refinery in Lima, OH
>> that was mothballed. I have never heard of them taking any interest
>> in reopening it. If they did I think they would create a surplus in
>> the market that would tend to drive the price down. For them it is
>> better to leave it shutdown and let the prices rise. Their is extra
>> refinery capacity in this country, they just don't want to utilize it.
>>
>> BTW, Milk at Sam's club was $2.28/gallon the other day. That milk was
>> sucked out of a cow 3-4 gallons per cow, refrigerated, transported,
>> separated in sterile conditions, homogenized, pasteurized, bottled,
>> transported in refrigerated trucks, delivered to the store with an
>> expiration date, and sold to me in a quantity of 2 gallons for $2.28
>> per gallon.
>>
>> None of these price levels make any sense at all.
>>
>> These fuel prices are total BS. And if the citizens of the US don't
>> get upset about the prices, then they only deserve to pay more.
>>
>> And why any country would apply a 100%+ tax to motor fuel is beyond
>> me. The only reason I can think of to apply taxes like that is social
>> engineering. They simply want to minimize the use of cars and trucks
>> for some bigger purpose. Nothing else makes much sense.
>>
>> Dave
>>
>>
>>
>> MYDEUCEANDWILLYS@aol.com wrote:
>>
>>> To Pay for fuel or anything else without knowing what the costs
>>> really are ,And what drives the cost , not coming in clear, I
>>> believe its time to complain and talk about it and then mavbe protest
>>> it, As for us Americans compaining about high fuel cost, seems silly
>>> because you pay more? Well its our right and we will do it ! and
>>> doing it has kept our costs lower than yours, I think that answers
>>> most of it, Thanks Randy MTA of NJ out
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>>
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>>
>>
>>
>
>
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