Gas Prices

#26
#26
therealUT said:
First, no one forced you in to sales. Second, for whatever product you are selling, the current gas prices simply provide a competitive advantage for those who are based close to their consumer base.

In pure economic terms, the profit margin for your products should fall in markets where you do not have that competitive advantage, yet rise in those you do.

I am also going to assume that you are getting paid for mileage. Five or ten years ago you were probably earning a decent amount of income from simply being on the road for so many miles. I am sure that you are earning decidedly less for that now.
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:yes:
 
#27
#27
therealUT said:
First, no one forced you in to sales. Second, for whatever product you are selling, the current gas prices simply provide a competitive advantage for those who are based close to their consumer base.
In pure economic terms, the profit margin for your products should fall in markets where you do not have that competitive advantage, yet rise in those you do.

I am also going to assume that you are getting paid for mileage. Five or ten years ago you were probably earning a decent amount of income from simply being on the road for so many miles. I am sure that you are earning decidedly less for that now.
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That is a joke.

For what I do not 100% true, but I just felt like arguing for a second I really don't complain that much about prices.

nope.

Five years ago I was a freshman at UT and 10 years ago I was in middle school so I'm making a lot more now! :)
 
#28
#28
We need an alternative fuel and I will bitch and complain until we have one in the mainstream.
 
#29
#29
Alternative fuels would not flourish. Companies would drop prices until the customers flocked back to buy cheap gas. Eventually, the alt. fuel companies would go out of business and gas would rule again.

Maybe everyone should quit buying from a certain gas station or two, say Exxon and Mobil(even though they are 1 now). Eventually, they would drop prices until customers came back. When those customers come back, other stations would have to follow suit or they would go out of business.
 
#30
#30
hvwarrior58 said:
Alternative fuels would not flourish. Companies would drop prices until the customers flocked back to buy cheap gas. Eventually, the alt. fuel companies would go out of business and gas would rule again.

Maybe everyone should quit buying from a certain gas station or two, say Exxon and Mobil(even though they are 1 now). Eventually, they would drop prices until customers came back. When those customers come back, other stations would have to follow suit or they would go out of business.
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Look for the oil companies to corner the market on alternative fuels before this happens.
 
#31
#31
TennTradition said:
Look for the oil companies to corner the market on alternative fuels before this happens.
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Of course Big Oil will corner the market on alternative fuels. However, since the R&D, as well as the production of such fuels, is more costly than the refining of gasoline, they will drop the prices of alternative fuel (and regular gasoline) to push out competition. Then, they will set the prices to secure their profit margin, and gas will reign as king.
 
#32
#32
therealUT said:
Of course Big Oil will corner the market on alternative fuels. However, since the R&D, as well as the production of such fuels, is more costly than the refining of gasoline, they will drop the prices of alternative fuel (and regular gasoline) to push out competition. Then, they will set the prices to secure their profit margin, and gas will reign as king.
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That sounds about like it. However, gas will become more expensive in time as oil reserves cost more to recover. I know that Shell believes they will get large reserves in the area of $30-40/barrell through oil shale...and that would be hard for alternative fuels to compete with. I would expect that the only large impetus to alternative fuels that might leave the oil companies to continue selling them is legislation to curb CO2 emissions and usher in a biofuel market. Depending on what taxes/subsidies are....oil companies may find it more profitable to deal in the biofuels.
 
#35
#35
I don't but the alternative fuel is more expensive bs from BIG OIL. More lies.
 
#36
#36
I was just thinking (Monday AM Devil's Advocate): how much does it cost for a gallon of milk? Better yet (since it's bio-friendly): how much for a gallon of soy milk?
 
#37
#37
Another staple that the price is directly affected by the rising cost in fuel.
 
#39
#39
kiddiedoc said:
I was just thinking (Monday AM Devil's Advocate): how much does it cost for a gallon of milk? Better yet (since it's bio-friendly): how much for a gallon of soy milk?
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And how much would a gallon of milk cost if the dairy industry had not been allowed to build any new milk processing plants in the lower 48 during the past 25 years, and was still using 25 year old technology despite the huge growth in population?
 
#40
#40
g8terh8ter_eric said:
You have to have revenue to have profit. As I do agree with you on the consumer part, this is one time in our civilization that the government needs to step in and freeze prices and reduce the gas tax until we become independent of foreign oil. So until they do that I will blame them because they make more off if a gallon of gas than do the oil companies.

Gas Taxes

There's you a nice link to show just how "raped" we are on gas.
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And what would you do to replace that revenue? Add it to the deficit so we pay interest on it, and then interest on interest?
 
#44
#44
KentheOrange said:
And how much would a gallon of milk cost if the dairy industry had not been allowed to build any new milk processing plants in the lower 48 during the past 25 years, and was still using 25 year old technology despite the huge growth in population?
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And in that period it was not allowed to build updated facilities, how many were the favored political party in power with no help? See the GOP has been in power for some time but somehow cannot seem to do anything on their own. They can easily get past the environmentalist argument but still use it as an excuse. But now the Dems are back in, that excuse which was worthless can now appear to be legit again. Wasted chance.
 
#45
#45
This thread kills me. The original post squarely blamed refining issues for the gas spike - that was immediately ignored in favor of blaming the govt and oil execs. The real question then is why is refining capacity so tight?

As for record profits it's pretty simple. Volume is at record highs: Increase volume with same profit margin = higher total profits. If people use less, profits go down.
 
#46
#46
volinbham said:
As for record profits it's pretty simple. Volume is at record highs: Increase volume with same profit margin = higher total profits. If people use less, profits go down.
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That would mean that this could all be explained with simple math. I don't know what you are thinking trying to pass off this type of voodoo analysis.
 
#47
#47
CSpindizzy said:
And in that period it was not allowed to build updated facilities, how many were the favored political party in power with no help? See the GOP has been in power for some time but somehow cannot seem to do anything on their own. They can easily get past the environmentalist argument but still use it as an excuse. But now the Dems are back in, that excuse which was worthless can now appear to be legit again. Wasted chance.
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Sounds good in theory. The environmentalists are basically federal (speaking of power base) but you still have a few pesky states rights left and one of the has been exercised loudly - "Not in my backyard". Probably the only federal action that may have been taken to build new refineries was to have leased federal properties that had been military bases (already environmentally poisoned) to oil companies. That would have been a great risk to the oil companies since we have seen changes in political power affect commitments made by the feds. With permits, safety, etc. I understand it takes 3 - 5 years to get a refinery into production. That is a long time to have that much capital at risk.
 
#48
#48
volinbham said:
This thread kills me. The original post squarely blamed refining issues for the gas spike - that was immediately ignored in favor of blaming the govt and oil execs. The real question then is why is refining capacity so tight?

As for record profits it's pretty simple. Volume is at record highs: Increase volume with same profit margin = higher total profits. If people use less, profits go down.
Click to expand...

That one is easy.
How many more vehicles are on the road now than 1980? Approximately 75 million

How many more refineries now than in 1980? ZERO. Well, actually one small one in Alaska.
 
#49
#49
KentheOrange said:
That one is easy.
How many more vehicles are on the road now than 1980? Approximately 75 million

How many more refineries now than in 1980? ZERO. Well, actually one small one in Alaska.
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Correct. What I intended with that question was looking into why refining capacity hasn't been expanded in the last 20-30 years.
 
#50
#50
volinbham said:
This thread kills me. The original post squarely blamed refining issues for the gas spike - that was immediately ignored in favor of blaming the govt and oil execs. The real question then is why is refining capacity so tight?

As for record profits it's pretty simple. Volume is at record highs: Increase volume with same profit margin = higher total profits. If people use less, profits go down.
Click to expand...

Considering all of the ones rattling on about environmentalists keeping any new refineries being built, I remind those the party that favors Big Oil was in charge for some time and did absolutely nothing. So actually YES government is to blame. If government is prohibiting any new construction that could relieve this, who else can be blamed?
 
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