Record profits for oil company

[TOMLESCOEQUIP]

Here's a link to more discussion fodder, including a poll about prices. Record profits Now if they just reinvest the profits in more infanstructure & not into their execs pockets, maybe some is justifible......I'm okay with it if they reinvest............comments ?

 

[waybomb]

I agree, but that is a mighty big "if". I bet it is new yachts for anybody at Exxon with either a "v" or a "p" or both in their titles at Exxon.

There has benn no ethics improvement in American business, at least not that can be witnessed by this.

 

[Doc]

So, when do you think the prices will come down?

 

[waybomb]

When people stop using fuel. What incentive does Exxon have to lower prices? I wonder if anybody has any figures on pre-inflated prices versus same time this year gas usage? I bet if there is a drop in total usage, it isn't much. I drive through Chicago every Friday night and I certainly haven't seen a drop in congestion.

 

[waybomb]

Oh ya, don't count on me to stop burning fuel!


Even though my usage has dropped like a rock now that the boat is parked for the winter.

 

[Doc]

When people stop using fuel. What incentive does Exxon have to lower prices? I wonder if anybody has any figures on pre-inflated prices versus same time this year gas usage? I bet if there is a drop in total usage, it isn't much. I drive through Chicago every Friday night and I certainly haven't seen a drop in congestion.

Yea, I think your right. I'd guess usage is the same or growing. I'm also buying less since the boat is just sitting in the pole building.
But I plan to boat as much as possible next summer, just like always. We put 140 hours on it last season, 150 was our high a couple summers ago. We'll try to beat that record.

 

[waybomb]

I probably only got 30 hours on mine this summer. But that's at anywhere from 70 to 200 gallons per hour.

 

[Cityboy]

Here is what Neal Boortz thinks about it. I concur. http://boortz.com/nuze/index.html

Yesterday the world's largest oil company, Exxon Mobil, announced their quarterly profits. They raked in $10.7 billion last quarter. That should make their shareholders happy. That brings their total yearly profit to $36.13 billion. That's a nice chunk of change.

But you know what such news means. It's time to drag the oil executives back in front of Congress...to complain about the mythical, non-existent "price-gouging." Politicians will wring their hands about how Exxon Mobil is stealing money from people...and not "giving back" to the community. All of this, of course, is thanks to the government schools that churn out people who have absolutely no understanding of basic economics.

For the less-educated, here are a few pointers:

• Exxon Mobil doesn't set the price of oil, the world market does. They're just cashing in. That price is determined by supply and demand, and nothing else. Sorry. If you want oil to be cheaper, you have to drill for more of it, bring to market and drive down the price.
• The oil companies are doing what they're supposed to. It is the function of a public corporation to make as much money as possible for its shareholders.
• If we expect to drill for more oil...and refine more gasoline...where do people think the money to do that will come from? Reinvested oil company profits, that's where. Somebody has to pay for exploration.

At the end of the day, it is the radical environmentalists that are making oil companies rich. The tighter the supply, the bigger their profits. So now you know who to blame!

 

[beds]

Yeah, there's all kinds of environmentalists in the middle-east where the majority of the world's oil comes from. And they're responsible for the huge price increase. Well, the three of them will be thrilled, I'm sure.

And you're sadly mistaken if you think the price of oil is a simple supply and demand equation.What alot of tripe that Neal Boortz produces. "If you criticize the multi-billion dollar war in Iraw, you're a terrorist". If that's the case, future generations of Americans will wish there were more terrorists around in the country as they try to dig out from such a huge financial burden.

 

[Cityboy]

Yeah, there's all kinds of environmentalists in the middle-east where the majority of the world's oil comes from. And they're responsible for the huge price increase. Well, the three of them will be thrilled, I'm sure.

This is the government school education churning out people with with no understanding of basic economics that Boortz referred to. The price is affected by OPEC, however if we could dilute OPEC's effect on prices by more offshore drilling, drilling in ANWR and working on additional alternates simultaneously, there would be more supply and the price would drop. It is the anti-capitalist environmentalist's influence on congress that have restricted refineries and exploration and required who knows how many different blends of fuels for different states and seasons that prevents this.

And you're sadly mistaken if you think the price of oil is a simple supply and demand equation..

Sorry, but it is simply supply and demand. If you put more oil and refineries into the economy, the price drops. This is not difficult to comprehend. Restrict the supply, restrict refineries, restrict exploration and drilling and the price goes up. Basic economics.

What alot of tripe that Neal Boortz produces. "If you criticize the multi-billion dollar war in Iraw, you're a terrorist". If that's the case, future generations of Americans will wish there were more terrorists around in the country as they try to dig out from such a huge financial burden.

Umm, Boortz never said that. If you're anti-Iraq war, fine, but please don't make stuff up. If you listen to Boortz for a while you might learn what he actually does say and believe and you would not have to resort to making it up as you go.

 

[BoneheadNW]

At the end of the day, it is the radical environmentalists that are making oil companies rich. The tighter the supply, the bigger their profits. So now you know who to blame![/font]

Wow, talk about sweeping generalizations! You had this lengthy post with facts and bullet points and then make the statement above. I do believe that there are reasons for the high profits besides the "radical environmentalists". How about finding alternative sources of energy? Once the demand for oil drops, the supply should go up. The supply-demand bit is the only thing I remember from my economics class!
Bone

 

[waybomb]

So, OPEC sets the price? And what American law has Exxon charging OPEC's price? They can charge whatever the hell they want! And they do - a lot.

 

[bczoom]

They can charge whatever the hell they want! And they do - a lot.

Don't you mean "+ a lot"?
I'm trying to stay out of this one but a company that generates that much profit when production is down from the previous quarter/year is (in my opinion) screwing someone (all of us...).

 

[Cityboy]

Don't you mean "+ a lot"?
I'm trying to stay out of this one but a company that generates that much profit when production is down from the previous quarter/year is (in my opinion) screwing someone (all of us...).

BC,

Should the federal government then dictate a company's profit margin? How much profit should a company be "allowed" to make?

 

[Cityboy]

Wow, talk about sweeping generalizations! You had this lengthy post with facts and bullet points and then make the statement above. I do believe that there are reasons for the high profits besides the "radical environmentalists". How about finding alternative sources of energy? Once the demand for oil drops, the supply should go up. The supply-demand bit is the only thing I remember from my economics class!
Bone

That was a quote from Neal Boortz. I thought about editing it out, and probably should have in retrospect, but let it stay. It is interesting how you picked that single line out of all that information to comment about. I also did mention alternatives in a subsequent post. Did you read it, or where you so overwhelmed by the "environmentalist" comment that you couldn't?

 

[Melensdad]

I'm not really sure I understand the problem.

Oil companies make money selling oil. It is not a monopoly. It is legal. We want their product. They sell more of it every year. We demand to buy more of it every year. Seems fair to me.

Now some might argue that their profits should be used to explore alternative fuel. I think that is silly. Their profits, because they are a legal company can be used for ANYTHING they want to use them for. That can be for developing alternative fuel sources, or for increasing the dividends to their shareholders, or anything else they want.

At what point do profits become 'excessive' to people?

Is Exxon making record profits any different than an Tom Cruise being paid $15,000,000.00 to act in a movie that takes 5 months to film? Or is it excessive when Tiger Woods earns $70,000,000.00 per year from tournaments and endorsements?

JMO but 'excessive' often means "I wish I had that" "but since I don't I'm going to tell you what to do with your money or try to take it away from you by getting a bunch of other jealous people together to start a class war and legislate it away from you."

 

[Gatorboy]

JMO but 'excessive' often means "I wish I had that" "but since I don't I'm going to tell you what to do with your money or try to take it away from you by getting a bunch of other jealous people together to start a class war and legislate it away from you."

Amen!

 

[Cityboy]

JMO but 'excessive' often means "I wish I had that" "but since I don't I'm going to tell you what to do with your money or try to take it away from you by getting a bunch of other jealous people together to start a class war and legislate it away from you."

Bingo! You hit it sqare on the head, Bob

 

[Cityboy]

Amen!

Welcome to the debate Gator-Dude! Jump in and contribute and have some fun.

 

[bczoom]

BC,

Should the federal government then dictate a company's profit margin? How much profit should a company be "allowed" to make?

Not at all.

In the general context of Bob's post, they (Exxon, Tom Cruise...) can all do what they want.

Personally, when I see a company that has opted to put it's bottom line so far ahead of their customers, I just choose to take my business elsewhere. Just recently, I've seen/encountered significant issues with Dell and Symantec who seem to have forgotten to take care of their customers. Personally, I'll just go elsewhere.

Not to get the thread off topic, but to note on Bob's post, as for movie stars, I don't care what they get for a movie. Their off camera words/actions determine whether they'll get my dollar to see their movie(s). There are several that if I see their name in a movie, I don't care if it's on my TV... I just refuse to watch it.

 

[beds]

I read that whole article and here is the excerpt that I was referring to when saying he painted leftists as terrorists:

"But do you get the sense, reading about this story in the press and watching the coverage on TV, that the media is rooting for Zawahri? Other than Fox News, you don't hear him described as a terrorist. And why do you suppose that is? Because many on the left in the mainstream media actually agree with him. You will also hardly ever hear him accurately described as an Islamic terrorist. Muslims would never do such things, you know.

Come to think of it, Zawahri has a lot in common with the American left. He hates George Bush, so do they. He thinks the Bush administration has been a failure, so do they. Zawahri criticizes the war in Iraq and talks about soldiers coming home in body bags...so does the left. Come to think of it, I think Cindy Sheehan has a future. She could be a speechwriter for Al-Qaeda."

OPEC decides how much oil to produce. There is no supply and demand. The demand is disproportionately high now because the US is stockpiling oil in preparation for its attack on a "Muslim Extremist" country - which will cause a rift in oil production. The supply is the same so the price is high.

Domestic production of oil will not bring down the price of oil. The same Exxon's will sell their domestically produced oil at the going rate - they will not discount it to be kind. The only way domestic production of oil could bring down the global price of oil is if the supply was so huge that it could fill the demand and bring that down. Then if the price of oil drops, it will no longer be profitable to produce it domestically.

Oil companies can have their profits - good for them, I'm not arguing that - I'm arguing this quote that oil is supply and demand. Oil is OPEC.

 

[Melensdad]

Why does nobody care that Wal-Mart makes records profits virtually each and every year . . . yet nobody calls it excessive?

And why is it that Wal-Mart effectively forces its suppliers to close down their American factories and reduce costs by shipping the jobs to communist China, yet everyone blames the factory owners instead of Wal-Mart when it is really Wal-Mart who is profiting from these factory closings because it is getting lower priced goods. The factory owners slash their American workforce, move production overseas, and typically end up with even lower profit margins, but lower margins are better than no profits at all so they at least keep their jobs. Yet while Wal-Mart's profits go up due to these activities, nobody claims their profits are excessive!

And I'm not just picking on Wal-Mart, it is just a simple example of the double standards.

Look at the tobacco companies, they make a product that kills people, but it is taxed so heavily that no politician would seriously consider outlawing tobacco. The fact of the matter is I pay about $1,000,000.00 PER WEEK in tobacco TAXES and my business is pretty small in the grand scheme of things. The politicians know that they are addicted to nicotine in the same way a smoker is addicted. They don't want to do away with the tobacco companies profits, because to eliiminate the profits the tobacco companies make is akin to closing them down, and closing them down eliminates the tax revenue they use to pay for all their do-gooder social programs.

If anyone wants to ACTUALLY DO SOMETHING about us becoming OIL INDEPENDANT then what they would do is TAX ALL OIL HEAVILY and DEDICATE the tax revenue specifically to RESEARCH & DEVELOPMENT of alternative fuels. They would build more 'wind farms' and more hydroelectric dams. And they would open drilling in ANWR to become the substitute for the 20% of our oil we import from the Middle East.

But nobody has the guts to do that. Too many voters would scream when their heating oil was taxed another 50-cents a gallon and gas and diesel rose by 50-cents a gallon for the new tax.

We all want things, we just want OTHER PEOPLE TO PAY FOR THEM.

 

[XeVfTEUtaAqJHTqq]

We all want things, we just want OTHER PEOPLE TO PAY FOR THEM.

I also don't want to have to work for anything either! Working is too hard. Can't I just stay home and watch TV all day? Bob, you sound like you are doing OK, you don't mind paying for everything do you? I mean you really don't want to see me suffer do you? Suffering is really bad! So if you don't stop me from suffering then you must be bad too!

 

[Cityboy]

If anyone wants to ACTUALLY DO SOMETHING about us becoming OIL INDEPENDANT then what they would do is TAX ALL OIL HEAVILY and DEDICATE the tax revenue specifically to RESEARCH & DEVELOPMENT of alternative fuels. They would build more 'wind farms' and more hydroelectric dams. And they would open drilling in ANWR to become the substitute for the 20% of our oil we import from the Middle East.

But nobody has the guts to do that. Too many voters would scream when their heating oil was taxed another 50-cents a gallon and gas and diesel rose by 50-cents a gallon for the new tax.

We all want things, we just want OTHER PEOPLE TO PAY FOR THEM.

Would you really want to put the responsibility for the research of alternative fuels into the hands of government through fuel taxes? Outside of an outstanding military and a good road system, the government does nearly nothing well or efficiently. No nation in the existence of mankind has ever taxed itself into prosperity. The last thing our govermment needs is more taxes to buy votes with. Once that oil tax goes to Washington, how much of it do you actually believe will go to research? How much will likely go to vote buying social programs? The solution lies in the private sector with companies working to make a profit by inventing a better widget demanded by the consumers. Companies exist to make a profit, not for the "greater good", but by working for and earning a profit, there will be greater good for Americans than any government wealth redistribution plan could ever produce.

 

[beds]

If anyone wants to ACTUALLY DO SOMETHING about us becoming OIL INDEPENDANT then what they would do is TAX ALL OIL HEAVILY and DEDICATE the tax revenue specifically to RESEARCH & DEVELOPMENT of alternative fuels. They would build more 'wind farms' and more hydroelectric dams. And they would open drilling in ANWR to become the substitute for the 20% of our oil we import from the Middle East.

It's actually 75% rather than 20%.


http://www.forbes.com/business/feeds/ap/2006/02/01/ap2490856.html
"In his State of the Union speech Tuesday night, President Bush declared that America must break its dependence on Mideast oil. He outlined plans to increase federal spending on research into alternative motor fuels and to set "a national goal" of replacing 75 percent of the oil now imported from the Middle East. "

Personally, I agree with the "sin" tax. We are heavily taxed on sin merchandise in Canada - alcohol and tobacco and to some extent gas. If you really make gas a sin tax - raise taxes to make it undesirable and use that revenue to supplement roads (that's what we do here, supposedly), then people could digest that. There are less consumptive ways of getting around than a Hummer or Expedition and people can choose those V8s knowing that the fuel will cost them huge.

 

[Melensdad]

No Beds you are wrong.

The President used a little verbal slight of hand last night. I believe that the middle east sells us much closer to 20% of our oil than 75%, other nations like Nigeria (Africa), Venezualia (South America) that are not in the middle east sell us the remainder. Most are members of OPEC, but that is not what was discussed.

So really the President wants to reduce our dependance by 75% of about 20+% of the total consumed.

Now my 20% is an estimate, but I'm pretty darn sure it is under 30%.

 

[Cityboy]

I read that whole article and here is the excerpt that I was referring to when saying he painted leftists as terrorists...............<snip>

Oil companies can have their profits - good for them, I'm not arguing that - I'm arguing this quote that oil is supply and demand. Oil is OPEC.

First, Boortz did not say what you paraphrased or made up. He was pointing out that leftists tend to side with the radical Islamist terrorists. He never said that these leftists were actually terrorists, though they do provide aid and comfort to our enemies through their words in the media.

Second, regardless of your attempt to frame the argument otherwise, it is still the market forces of supply and demand that drives prices in any industry. Necessity is the mother of invention. This is not just a cliche. It is the for-profit companies that will find and implement the sloution to our oil price issues, not the federal government, and they will do it for the opportunity to make a profit, and we will all benefit as a result. More oil and alternatives will drive up supply and decrease the demand for middle-eastern oil. Smile and be happy when American company's make profits. This is a good thing. Don't allow youself to wallow in the self pity of class envy, calling for the government to solve all our problems. That has never, and will never work. American for-profit ingenuity will prevail as it always has when it is allowed to.

 

[XeVfTEUtaAqJHTqq]

There really should be better tax incentives for "home grown" power sources. I could probably be self sufficient on my home electricity from wind (lots during the fall, winter, and spring) and solar (good southern exposure during the summer) but the expense of the equipment just doesn't justify it. However, if I could deduct that expense from my taxes then I would do it in a second.

 

[Melensdad]

Just to provide a technical correction to my above post, 23% of our oil comes from the middle east. That is 3% more than the 20% I claimed. It is however, well below the 75% number that some people believe. It is also why I think the President was pretty misleading in his speach last night.

See the pdf file attached to see where oil consumed in the US comes from.

 

[beds]

First, Boortz did not say what you paraphrased or made up. He was pointing out that leftists tend to side with the radical Islamist terrorists. He never said that these leftists were actually terrorists, though they do provide aid and comfort to our enemies through their words in the media.

He said Zawahri is a terrorist and the American left have alot in common with him. That's what he said.

I will agree with you in your statement that there is a demand side to the Oil equation, but the supply side is not set by market conditions, it is set artificially by OPEC.

And Bob, those countries are all OPEC countries, so the dismantling of OPEC must also be part of Bush's plans.