[Ansteorra] Re: gas prices too high...sorry had to share this

[David J. Hughes]

Ambience wrote:

> <snip>
>
> At 08:18 AM 4/21/2006, you wrote:
>
>> Date: Thu, 20 Apr 2006 22:23:03 -0500
>> From: "David J. Hughes" <davidjhughes.tx at netzero.net>
>> Subject: Re: [Ansteorra] gas prices too high...sorry had to share this
>>
>> Gasoline, $ 3.00 / gallon
>> Federal taxes   0.40
>> Station owner's cut, (pays the salaryof the workers, bills, property
>> tax, etc.) 0.03
>> ExxonMobil's cut  under franchise contract  0.01
>> Delivery charge 0.03
>> Processing  costs 0.25  (operating costs, maintanence, salary of
>> operators, catalysts, etc.)
>> Raw material cost (price of oil per barrel times @1.35 divided by 42
>> gallons per barrel)
>> for $71 per barrel    2.28
>> total 3.00
>>
>> Price of oil is set by market demand.  $1.30 gasoline requires oil at 
>> $18
>> At $1 per barrel, the cost would be $ 0.75
>>
>>
>> That 1.35 number? Not all of a barrel can be made into gasoline, and
>> some of it is used to fuel the refinery itself, to generate high
>> pressure steam, electricity, make hydrogen,  etc.
>
>
>
> I'm sorry this is off topic, but it really effects our disposable 
> income, ie how much we can spend on our hobbies...
>
> I have to respectfully disagree with some of the numbers above.  I did 
> some searching on just that last night)
> Below is a table I copied from the California state government page. 
> (Sorry I didn't see a table like this for Texas) back in Nov of 2000 
> crude oil was selling around $36 a barrel, yesterday it was $72. By my 
> reckoning that should have doubled the crude oil cost of the equation, 
> adding about 74-80 cents to the cost.  Making the price around $2.60 
> per gallon, I checked http://www.californiagasprices.com/ and prices 
> are around   $3.30 per gallon. Either the dealers or refiners have 
> increased their profit margin by quite a bit.  Oil companies did 
> report record profits last year.  I guess they want to this year too.
>
The table lumps costs differently than I did.  I used estimated fixed 
costs for most of mine, seperating out those costs directly affected by 
the price of oil into one simple line item, while the table scatters 
those over the first four lines.
Retailers have lowered their profit margins to the bone, refineries 
don't make much profit on gasoline or diesel.
Oil companies make the big profits, currently, by getting the oil out of 
the ground.
Example:
UAE owns the oil under their land.
They want an oil company  to get it out.
The oil company advances UAE 5 billion dollars to explore, drill, 
develop and connnct by pipeline 200 wells.  This is paid back over time, 
at normal interest rates, from oil profits.
Oil company makes @5% ROI from this for 25 years.    Oil company also 
gets a flat rate for oil production (pumping it out, cleaninig it up, 
getting it into the pipeline) for every million barrels produced,  
around $2 per barrel,  on which they make about 30 % ROI. On top of this 
, they get @ 10% of the sale price.
Suppose UAE sells 5 billion barrels in a year.  At $8, UAE gets $26 
billion, the oil company gets $14 Billion, of which $7 billion is profit..
At $72, UAE gets $305 billion, the oil company gets $ 45 billion, of 
which $38 billion is profit..
Now, that oil company "profit" isn't bottom line profit.   Out of that, 
they pay stockholders,  taxes,  business expenses, construction costs 
for new facilities, and research costs as an investment in the future.
At $8, the oil company just about breaks even, with little left over for 
new construction or research.

> Most of us will continue to fork it out at the pumps, gripe about it, 
> and cut back on other things.  Do something Write your congressman, 
> tell him/her how displeased you are, ask them what they are doing 
> about it.
>
> Nov 6, 2000 Nov 13, 2000 Nov 20, 2000 Nov 27, 2000 Dec 4, 2000 Dec 11, 
> 2000 Dec 18, 2000 Dec 26, 2000
> Dealers Cost and Profit Margin (1) - $0.02 $0.10 $0.17 $0.15 $0.16 
> $0.26 $0.26 $0.23
> Crude Oil Cost $0.74 $0.78 $0.81 $0.80 $0.67 $0.59 $0.59 $0.50
> Refinery Cost and Profit Margin (2) $0.57 $0.40 $0.28 $0.30 $0.40 
> $0.36 $0.33 $0.44
> State and Local Sales Tax $0.13 $0.13 $0.13 $0.13 $0.13 $0.13 $0.12 $0.12
> State Excise Tax $0.18 $0.18 $0.18 $0.18 $0.18 $0.18 $0.18 $0.18
> Federal Excise Tax $0.18 $0.18 $0.18 $0.18 $0.18 $0.18 $0.18 $0.18
> Retail Prices $1.79 $1.78 $1.75 $1.74 $1.72 $1.69 $1.66 $1.65
>
>
> table from http://www.energy.ca.gov/gasoline/margins/2000.html  (this 
> page has lots of information and graphs)
>
>
> sincerely,
> Seraphina
>
>
>------------------------------------------------------------------------
>
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