What Others Pay

[Rocket Heart]

Read an article the other day that showed what other countries are paying for gas: Europe countries are getting the worst of it all with prices from 4.50 - 6.00 per gal. but look at some others: Mexico = 2.22; Buenos Aries = 2.09; Saudi Arabia= .91; Kuwait .78 and last but not least Venezuela = .12!!!

Prices here NW Ohio today 3.59 per gal average. People are having to make a choice between food and gas to go to work. I am certainly not one to fgure all this out but common sense tell's me the oil companies who are selling the low end are making a profit - there is no way to justify what is happening to the rest of the world except greed. It's like were at war only not one shot needs to be fired - their using what they have to bring us down - oil.

I know many of you say keep on going but for me there is a breaking point - and it's real close. For those who keep going, put some happy miles on for the Rocket.

[Rocket Heart]

Read an article the other day that showed what other countries are paying for gas: Europe countries are getting the worst of it all with prices from 4.50 - 6.00 per gal. but look at some others: Mexico = 2.22; Buenos Aries = 2.09; Saudi Arabia= .91; Kuwait .78 and last but not least Venezuela = .12!!!

Prices here NW Ohio today 3.59 per gal average. People are having to make a choice between food and gas to go to work. I am certainly not one to fgure all this out but common sense tell's me the oil companies who are selling the low end are making a profit - there is no way to justify what is happening to the rest of the world except greed. It's like were at war only not one shot needs to be fired - their using what they have to bring us down - oil.

I know many of you say keep on going but for me there is a breaking point - and it's real close. For those who keep going, put some happy miles on for the Rocket.

[TAN]

Gas hear in Canada, at lest in B. C. is $4.84.

[RustyJC]

<BLOCKQUOTE class="ip-ubbcode-quote"><div class="ip-ubbcode-quote-title">quote:</div><div class="ip-ubbcode-quote-content">Originally posted by Rocket Heart:
I am certainly not one to fgure all this out but common sense tell's me the oil companies who are selling the low end are making a profit - there is no way to justify what is happening to the rest of the world except greed. </div></BLOCKQUOTE>
It's far more complex than the numbers would indicate. Most of the countries where fuel prices are higher than ours have governments that tax the fuels heavily to fund social programs - universal healthcare, etc. Conversely, one needs to look at the annual income per capita in those countries with low fuel prices. Many of these countries have governments that are, in effect, subsidizing fuel prices at an artificially low level to avoid social unrest. Venezuela, for example, tried price controls on bread, milk, etc. and found that the supplies dried up (as economic theory says will happen). Since they control the fuel supply via PdVSA (Petroleos de Venezuela, SA), the government-owned oil company, they can sell domestically at whatever price the government dictates.

If you want to see the "true" value the marketplace places on crude oil, gasoline, natural gas, etc., you need to look at the commodities exchanges such as NYMEX. The current pricing the commodities traders are buying and selling energy commodities can be seen HERE.

Insofar as the oil companies being culpable, consider that the major oil companies have a profit margin of around 9.5% to 10%, which is not that high in relation to corporations in general. Our company, for instance, had a 2007 profit margin of 10.7%, and that is very low compared to pharmaceuticals, etc.

Most crude oil on the world market is controlled by governments or their national oil companies (think OPEC) - that's the feedstock side. Selling prices for gasoline and diesel are determined by the markets as well as governments with their rates of taxation on (or how heavily they subsidize) the fuels.

Just something to consider.....


Rusty

[Rocket Heart]

<BLOCKQUOTE class="ip-ubbcode-quote"><div class="ip-ubbcode-quote-title">quote:</div><div class="ip-ubbcode-quote-content">Originally posted by RustyJC:
<BLOCKQUOTE class="ip-ubbcode-quote"><div class="ip-ubbcode-quote-title">quote:</div><div class="ip-ubbcode-quote-content">Originally posted by Rocket Heart:
I am certainly not one to fgure all this out but common sense tell's me the oil companies who are selling the low end are making a profit - there is no way to justify what is happening to the rest of the world except greed. </div></BLOCKQUOTE>
It's far more complex than the numbers would indicate. Most of the countries where fuel prices are higher than ours have governments that tax the fuels heavily to fund social programs - universal healthcare, etc. Conversely, one needs to look at the annual income per capita in those countries with low fuel prices. Many of these countries have governments that are, in effect, subsidizing fuel prices at an artificially low level to avoid social unrest. Venezuela, for example, tried price controls on bread, milk, etc. and found that the supplies dried up (as economic theory says will happen). Since they control the fuel supply via PdVSA (Petroleos de Venezuela, SA), the government-owned oil company, they can sell domestically at whatever price the government dictates.

If you want to see the "true" value the marketplace places on crude oil, gasoline, natural gas, etc., you need to look at the commodities exchanges such as NYMEX. The current pricing the commodities traders are buying and selling energy commodities can be seen HERE.

Insofar as the oil companies being culpable, consider that the major oil companies have a profit margin of around 9.5% to 10%, which is not that high in relation to corporations in general. Our company, for instance, had a 2007 profit margin of 10.7%, and that is very low compared to pharmaceuticals, etc.

Most crude oil on the world market is controlled by governments or their national oil companies (think OPEC) - that's the feedstock side. Selling prices for gasoline and diesel are determined by the markets as well as governments with their rates of taxation on (or how heavily they subsidize) the fuels.

Just something to consider.....

With all due respect that's same rhetoric I 've been hearing for some time now. It is OPEC specifically that I am speaking of. The opulance of the countries in the mid east is overwhelming! Meanwhile children are starving because the price of food is out of site!

I hate to be so negative about all this (especially because I just purchased a new coach) but we are in a global market place and if we have nothing to compete with we are being left behind - the CEO of Proctor & Gambel said basically the same thing last night on Charlie Rose show - most if not all major corporations are sending work to places that can do the same jobs we used to do with the same quality just to compete on a world platform. The rest of the world has equalled and in some cases have surpassed our workforce.

We have to change our way of operating here because we are getting our collective butts kicked.


Rusty </div></BLOCKQUOTE>

[Tom N]

The decreasing value of the US dollar makes oil much more expensive for us. Most, if not all, foreign currencies have increased in value against the US dollar.

[MtManLee]

When you mentioned Venezuela you must not have known that they do not have oil based fuels. They run off of sugar based fuels. They saw this coming 20 years ago and went the ethanol route. And Mexico bought one of our refineries here in the US and all the fuel refined there is going to Mexico. HMmmmm wonder what is wrong with this picture?
And we dont have enough refineries now to handle our crude for our use thus we send it to canada, saudi arabia and other countries to be refined and sold back to us as refined fuel. What wrong with that picture too?

[RustyJC]

I believe you're confusing Venezuela with Brazil. Venezuela certainly does utilize petroleum-based fuels. Brazil, on the other hand, utilizes ethanol derived from sugar cane.

Rusty

[tderonne]

This "gas or food" thing kills me.

Some numbers for an average American:
15,000 miles per year at 20 MPG is just shy of $220 a month for gas at $3.50 a gallon.

High? YES! But what's that same American's car payment? Car Insurance? House payment/rent? Cable bill? Cell phone bill?

Gas or food? Hardly. Car or food? Maybe.

[RustyJC]

<BLOCKQUOTE class="ip-ubbcode-quote"><div class="ip-ubbcode-quote-title">quote:</div><div class="ip-ubbcode-quote-content">Originally posted by Rocket Heart:
With all due respect that's same rhetoric I 've been hearing for some time now. It is OPEC specifically that I am speaking of. The opulance of the countries in the mid east is overwhelming! Meanwhile children are starving because the price of food is out of site! </div></BLOCKQUOTE>
OPEC is not ExxonMobil, ConocoPhillips, Shell, etc. OPEC is Saudi Aramco (Saudi Arabia), Kuwait Oil Company (Kuwait), PdVSA (Venezuela), Pertamina (Indonesia), etc. These are government owned oil companies that control crude oil production under the banner of the OPEC cartel.

Rusty

[Rocket Heart]

Please excuse me gentleman - just ranting a little - very inapproptiate for this forum.

P.S. I know who the players are and their role in all of this - just didn't word correctly - CRS moment..

[RustyJC]

<BLOCKQUOTE class="ip-ubbcode-quote"><div class="ip-ubbcode-quote-title">quote:</div><div class="ip-ubbcode-quote-content">Originally posted by Rocket Heart:
Meanwhile children are starving because the price of food is out of site! </div></BLOCKQUOTE>
Guess whose fault that is? Here in the Houston area, the government has mandated that our gasoline must contain 10% ethanol as an oxygenate.

In addition, there's market pressure here in the U.S. to use ethanol in a mistaken belief that by doing so we can wean ourselves off of imported oil. In response, GM is building FlexFuel cars that can burn E85 (85% ethanol, 15% gasoline), and E85 pumps are popping up around the country.

So, where does our U.S. ethanol come from? Almost all of it currently comes from the fermentation and subsequent distillation of corn - hence the term "grain alcohol". When we put a substance (i.e., corn) that has been used for food and animal feed (beef and dairy cattle) in the tanks of our cars, and when farmers take land that had been used for wheat or soybean production and instead plant corn for conversion into ethanol, what else can happen to our food prices? Of course they're going to skyrocket!

(On Edit - this very topic was discussed on tonight's edition of ABC World News.)

Rusty

[MaverickBBD]

First off I would like to say that this is one of the most rationale discussions of the price of fuel I have read on here in a while. Second, I would like to add that all commodities are subject to speculation and thus subject to a certain amount of manipulation. The last I heard $30 or every Bbl was the result of speculation. Which bring into perspective the topic of oil reserves. I hate to think there is collusion to bring in new reserves until certain finds (read ANWR) are permitted. The other troubling matter is the removal of Iraqi oil from the market (in the name of democracy). What is troubling to me is not so much the pricing as to what this government will do to ensure supply as world demand increases. Is "The Carter Doctrine" still a matter of National Security Policy? Having worked on the production side of the oil business for 27 years I was thankful that my company's profits allowed me to retire early. Now I guess they get to take some of it back as I enjoy my motor home.

[Whaler]

Please Rusty,don't confuse me with knowlege and comonsence,it is so much easier to just blame politicians and the 'Big Oil'companies!