Gasoline Price Gouging Investigations

[Guru]

http://www.usatoday.com/money/industries/energy/2008-09-16-gas-gouging_N.htm?csp=34

I hope they put them in jail.

Officials in North Carolina, Texas and Florida are investigating claims of price gouging as gasoline prices soared across large swaths of the nation in the wake of Hurricane Ike.

[Hawkeye]

this topic is already covered under hurricanes

[Guru]

And covered again before that...

[Fish-Bait]

I hope they hang em'.

[Guru]

Finally some states that may take the bull by the horns. Maybe some of this concern will bleed over across our state lines.

[katzeyez]

I was pleasantly surprised to see that gas had gone down twenty cents in Wiggins at Wally World. It was back down to $3.69, but all they had was regular unleaded.

[Guru]

Should be $2.69, or less.

[katzeyez]

Less being the operative word there.

[Hawkeye]

Should be $2.69, or less.

how you figure? wholesale at refinery is 2.49 then add transport, profit (middleman and retailer), state tax, and fed tax. I think fed tax is 40 cents

[Fotno]

The wholesale should be cheaper.

[Fish-Bait]

meanwhile in Venezuela it's hoverin' about 0.12 cents per gallon.

[Hawkeye]

well the dang crude is 1.81 gal based on this mornings price and you don't get 55 gal of gas out of 55 gal of oil. if you oil field guys wouldn't sat on dat arse so much, earl might get cheaper :D

[Fish-Bait]

well the dang crude is 1.81 gal based on this mornings price and you don't get 55 gal of gas out of 55 gal of oil. if you oil field guys wouldn't sat on dat arse so much, earl might get cheaper :D

What does a barrel of crude breakdown as? I'll try to find it. It prolly depends on what type of crude it is eh'?

[Fotno]

Their on strike in Venezuela.Chavez has his panties in a bunch.

[Fish-Bait]

bout 20 gallons for 42 gallons of crude.

[Hawkeye]

http://findarticles.com/p/articles/mi_hb4695/is_200504/ai_n17239976

[Fish-Bait]

43%.....or so.

what is diesel or how is it classified. I heard diesel is a by product of refinin' gasoline.

[Hawkeye]

actually a barrel of oil is only 42 gal. At $100 p/bbl = 2.38 p/gal crude.
it depends on what cracking process they use but a barrel of crude breaks down to about 20 gallon of gasoline, and 7 gal of distillates like diesel, jet fuel, heating oil, etc. The there of thousands of other uses from tires to cosmetics that it is used for.

billions of barrel equivalent go into making plastics of all kinds. you can't find one item in your house or office that is not tied to oil. it is the basic DNA of all manufactured products. its like economic blood

[Guru]

how you figure? wholesale at refinery is 2.49 then add transport, profit (middleman and retailer), state tax, and fed tax. I think fed tax is 40 cents

* I figure it because I am the guy that does a lot of financials on budgets and payouts for projects that gets it out of the ground.

[Guru]

There are many variables in the final cost of a barrel of refined product from a 1/4 of a mile deep up to 4 miles, ranging at this time.
State taxes and federal taxes have a lot to do with it along with the different prices you pay for services of all descriptions no matter what.
The leading culprit in the pricing you see at the pumps is Wall Street followed by state and federal vampires.

[Hawkeye]

* I figure it because I am the guy that does a lot of financials on budgets and payouts for projects that gets it out of the ground.

then maybe the guys getting it out of the ground are getting too much. refiners ain't making near the margin drillers are making.

is wall st responsible for the USA using 25% of the world's oil while china and india are putting an addition 9 million+ new gas burners on the road every year?

do you believe in the peak oil theory in this fast growing industrial world or you think there is enough oil to last forever?

[Guru]

What I think is that Wall Street is filled by a bunch of hysterical nancy-girls and that the government of any kind is nothing more than a bunch of blood sucking vampires that have proved to me that they have their hand stuck out like a bunch of welfare recipients hoping to get a little every time you look up or turn around. When you consider that the cost of a producing installation will run now, minus contract technological services and equipment, about twice what it did in the late 80's and early 90's you get a real feel for day traders and their influence on this world.
For every joe bob that thinks he is a day trader there are thousands more joe bobs and several thousand nancy-girls looking at the movement of any stock at any time in the course of a day. This upheaval exerts it's artificial influence on all the soccer moms of this world.
The money crunch just by the normal contract crew daily is confounding itself. The charge for one person may be 4 times what old joe bob gets to take home.
Prices are exacted, projects compounded, pump prices soar. This in itself is hard enough without the nancy-girl on Wall Street creating near chaotic rises and falls in the market by the second. Then you add the government vampires ...

[Hawkeye]

Is it wall skeet that is responsible for Exxon making the most profit each quarter than any company in the world's history?

[Guru]

Yes, it's their fault for managing their business correctly.
In truth the larger oil volumes come from other countries, our production pales in comparison.
If Sheik FakYou didn't like his scrammbled eggs for breakfast or Queen WantMore didn't put it on him just right he gets over hashished with his brethren and decides to cut production to drive prices up to pay for the 60 story play palace that was built on the Ivory Coast with the golf course on the roof and the blond American women inside.
They are worse than crack whores in Arab-America and suffer from consumerism to the nth degree.
Once the prices are driven up from the big volume boys it is sort of like a wheee roller coaster ride for the American based companies that have managed to keep a flea sized % of the sales overseas although they invested to the hilt in the technology and infrastructure along with the raw materials which were specially made in countries all over the world for the high friction and temperature production values that spew from their 20" open hole wells daily.
It's almost like chicken feed when you compare the American production values but when you are riding someone elses coat tail it makes it easy to sock back higher net numbers on a balance sheet.
It's like you buying 10 goats, I buy one, you engage in a global conveyance alliance for the sale of your 10 and I just get lucky because I am riding with you.

One other figure that I can offer for understanding is called a "Lifting Cost". This amounts to the money it costs on the surface for a fields total expense per barrel produced after exploration and completion fees.
Currently there is no set monetary figure per field. Each place has it's own demons when it comes to production.
For instance, a gas field will have lower Lifting Costs than a field that produces a great percentage of low gravity crude. Artificial lift costs, chemical costs, pipe depletion expenses, pipeline maintenance management and upkeep, improved technology and automated systems expenditures so we can lay off more joe bobs and do it with computers but at the same time perhaps refine our daily production values, governmental speeding tickets and the ensuing construction and maintenance fees that go along with that, human developement - training - benefits - also known in some corporations as "People Burden" (believe it or not).
Nothing is free and those that are in business have to make some sort of profit to remain in business. In today's world there are more and more of them. The American public wants to sit in their dens and play arm chair quarterback daintily while wanting the same goods and services and then btch when they have to pay for them.
I know what that is like, I do it everyday but I also know how the Leggo blocks go together and when I stop and lay out the equation it leaves me very little room for complaint except for Wall Street speculation driving materials - goods and services higher and the tax burden we are forced to bear so that people like the Democrats can get more votes on the promise that they will come up with more giveaway programs.

[Hawkeye]

So, you're saying oil producers don't like it when speculators drive the price of oil up? ;)

[Fotno]

Even though I work in drilling,I still have to buy gas for my vehicle.
If my rig wasn't scattered all over the bottom of the Gulf right now,we would be making a ridiculously high day rate,But I make the same salary as I always have.
If speculators cause enough drama to run up the price of gas it doesn't matter how much the oil companies make,I still make the same.So,I despise speculators.
It's getting to be a gigantic pain in the ass to pay for gas I assure you.

[katzeyez]

It's getting to be a gigantic pain in the ass to pay for gas I assure you.

Tell me about it, especially for those of us who's line or work call for a lot of traveling.

[Guru]

So, you're saying oil producers don't like it when speculators drive the price of oil up? ;)

* Not as much as you may think.
Sort of like when the minimum wage is increased and everybody and their Mama increases the prices of their goods trying to suck that increase out of everyone so goes the same with oil prices bounding up.
Prices go up, contract services will follow. Transportation fees for byproduct treatment increases, boat and helicopter fees, fuel and instrumentation gas follows although the producer make their own it is funny money that turns their balance sheets upside down.
Everyone would like to see their product share increase, even you but then you don't have the tagalongs that look for every increase so that they can jump on the first chance to increase their services too.
In a balloon type business such as energy, the first sign of an increase in profit margin is attacked like a Wildebeast running slow, everybody wants a bite.

[Hawkeye]

* Not as much as you may think.
Sort of like when the minimum wage is increased and everybody and their Mama increases the prices of their goods trying to suck that increase out of everyone so goes the same with oil prices bounding up.
Prices go up, contract services will follow. Transportation fees for byproduct treatment increases, boat and helicopter fees, fuel and instrumentation gas follows although the producer make their own it is funny money that turns their balance sheets upside down.
Everyone would like to see their product share increase, even you but then you don't have the tagalongs that look for every increase so that they can jump on the first chance to increase their services too.
In a balloon type business such as energy, the first sign of an increase in profit margin is attacked like a Wildebeast running slow, everybody wants a bite.
Guru, doesn't that bring more money into the economy and create more jobs, thus more tax revenue?

Fotno, its the price of oil falsely driven up my speculators which creates higher gas prices for the most part, but gasoline price is driven more by supply and demand against inventory. The SEC recently began an investigation into oil speculators and insinuated a new rule that essentially says, "If you or your company doesn't use oil in your business, you are not allowed to speculate on it". That is one reason oil has come down rather swiftly for near $150 p/bbl. Foreign sovereign wealth funds with trillions of dollars at their disposal were the dark speculators running the price up.

BTW; spot gasoline is up 10 cents this morning on low inventory as the result of gustav and ike. Most of the TX/LA refiners are either still not on line or running at very low production rates. Loss of power, some damage, and difficulty getting oil flowing again from the gulf pipelines is in play making it difficult to catch up on inventory.

Don't shoot the messenger :rolleyes:

[Guru]

Normally it does not bring more money or jobs into the market.
What usually happens is the wolves in the upper gallery see the rising dividends and curtail expenditures because they are greedy also.
You see more rig activity usually but that is the only constant part of the cash flow that I have been witness to.

[Hawkeye]

are deck hands and drillers not in short supply?

[Fotno]

They are.Partly because all of the people entering the work force are idiots.

[Hawkeye]

They are.Partly because all of the people entering the work force are idiots.

they is mo rigs punching mo holes too ain't day? after watch'g dat show Black Gold, I see what you mean about new hands. At least ya'll have the advantage of not letting them go to bars and stay out all night drunking

[Guru]

lol, that used to be the driller's main job. On land locations back in the day he made the rounds in the mornings picking up the hands that didn't make it to work on time.

I made a previous statement about the supply of jobs during peak price periods and mis-spoke myself. Let me re-explain it.
While peak price periods do make the rig count increase, mostly it is an eb and flow type of situation. The actual rig count domestically runs a close plotted line. There are small bumps and slumps but mostly this runs fairly consistent.
Goods and services follow this plot.

For stability I'm really looking forward to some sort of realistic alliance with South America, North America and Canada and the T. Boone Pickens idea of a resurgence in natural gas being incorporated into several of our crude applications.
Synthetic lubricants can play a large part in allieviating demands on crude sources that would help balance that demand, at least spread it around.
Natural or processed gas fuel sources for vehicles which would probably amount to a processed butane for automobiles would more than likely be the end result.

Small electric cars for city people or mass commuting even in places like Hattiesburg would be great if people would embrace this. The crime standpoint would have to be addressed but I see a time for that coming too. Anything as rampant as our low level crime figures cannot continue in a civilized society. This would help people accept local mass transit.

I watch daily for breaking news on a well anticipated hydrogen application ...

After the last administration anything would have been a step up but now I have my doubts about the people we have in office.
Also at this point in society I see no way to improve this without incorporating women's view points and applications into government management.
The more I listen to Sarah Palin and consider what she says and the possible results this becomes more apparent to me. On the lesser side, what harm would there be? I don't think at this point we could lose anything and she seems to at least have a touch with day to day reality. I could see her being a strong proponent of moving out of this overall rut we seem to be in.