Fuel Prices

[84LX89GT]

Originally Posted by Mr 5 0

Oil company profit margins are at about 6%, far less than other industries, such as MicroSoft. The SOMETHING you refer to is a highly increased demand for gasoline and other oil products while the supply remains static or, as has happened, is interrupted. The oil companies are making bigger profits because - as the availability of gas shrinks and demand increases - they can raise the price - as well as sell more, which is what is occuring...not some 'conspiracy'. Generally, raising the price (of gas) lowers consumption but that hasn't happened, so, the oil companies make more profit. Despite what many folks believe, it's not illegal to make a big profit and there is no law that gas prices can never go up, as some seem to believe.

That sounds like a fantasy but you are free to do whatever you wish in this regard. I hope it works out for you. I really do. I don't like high gas prices, either.

I don't see how creating ethanol is "fantasy", it's real easy to convert a carbureted car and many plans/permits are easy to acquire and execute. Ethanol requires different hoses/gaskets or additives can be put in with the tank to keep hoses from drying out. Not only that but increasing jets in a carburetor and (to get back power/efficiency) increasing compression ratio is NOT that hard to do. The hardest part is finding time to create the ethanol. I don't necessarily want to only run on ethanol, it's more of an interest and hobby than me wanting to "save money" but some home made stills made for a few hundred dollars can make 5-10 gallons per hour....which is quite a bit.

It's true that other companies make more profit margin than oil companies. how can microsoft not when most of what they're selling is information or an operating system. the box it comes in isn't that expensive. then again, the profit margin of oil companies (around 6% like you said) is actually higher than many other companies. I suppose you can't just blame oil companies, it's the whole system and OPEC that is feeding off this, but i can bet that the oil companies will be the LAST people to be hurting from price increases.

The united states has kind of had this whole thing coming for awhile, we've had time to prepare, but why when gas was so cheap for so long. I suppose i'm bitter because i hate not being able to drive my cobra as much since it's dismal 16 miles per gallon (washington hills) is pretty brutal.

[Mr 5 0]

Originally Posted by 84LX89GT

I don't see how creating ethanol is "fantasy", it's real easy to convert a carbureted car and many plans/permits are easy to acquire and execute. Ethanol requires different hoses/gaskets or additives can be put in with the tank to keep hoses from drying out. Not only that but increasing jets in a carburetor and (to get back power/efficiency) increasing compression ratio is NOT that hard to do. The hardest part is finding time to create the ethanol. I don't necessarily want to only run on ethanol, it's more of an interest and hobby than me wanting to "save money" but some home made stills made for a few hundred dollars can make 5-10 gallons per hour....which is quite a bit.

Sorry. I thought you were planning to manufacture ethanol on a commercial scale, not just for your own private use. Big difference - and a reading error on my part - for which I am apologetic. Gasoline in my state already contains 10% ethanol so we're well on the way. I've read that it takes more energy to produce ethanol than it's worth in gas savings. Perhaps that doesn't apply when only small amounts are produced, as you intend.

It's true that other companies make more profit margin than oil companies. how can microsoft not when most of what they're selling is information or an operating system. the box it comes in isn't that expensive. then again, the profit margin of oil companies (around 6% like you said) is actually higher than many other companies. I suppose you can't just blame oil companies, it's the whole system and OPEC that is feeding off this, but i can bet that the oil companies will be the LAST people to be hurting from price increases.

Any corporation's profits must be viewed in context. One high-profit quarter doesn't mean all that much, no matter how big the numbers are. ExxonMobil has sales of over 100 billion annually, it's relatively modest profit margin (9.9%) is not all that impressive. Most banks have 15% or better profit margins...and no one complains, calls that kind of healthy profit 'a conspiracy' or exclaims that "something is WRONG". Actually, ExxonMobil, based on corporate gross profit margins in 2004 - ranked No. 127. Wal-Mart (now a target of the political left for being a bit too successful) earns more than twice as much per year in sales as ExxonMobil. Is Wal-Mart now a 'conspiracy', too? I think not. John Deere has a higher profit margin than most oil companies and General Mills has almost twice the profit margin, to name just a few corporations with bigger net profit margins than any oil company. Computer software company profit margins generally run in the high teens to low 20's. True, MicroSoft was 'investigated' and heavily fined by the government awhile back but no one seriously talked about 'conspiracies'. It was just a crass money-grab. The subject of oil company 'gouging' gets ridiculous and is often based on sheer ignorance of the facts. Oil companies have been routinely 'demonized' for years by the media (easy target) and, properly brainwashed, many Americans are now ready and willing to 'hate' them and swallow oil company-related 'conspiracy theories' more willingly than they might like to admit. It's easier than actually thinking, I guess.

The united states has kind of had this whole thing coming for awhile, we've had time to prepare, but why when gas was so cheap for so long. I suppose i'm bitter because i hate not being able to drive my cobra as much since it's dismal 16 miles per gallon (washington hills) is pretty brutal.

I don't believe we 'had it coming', at all. Oil and petrolum products '('gas') are relatively cheap, effective lubricants and power sources. Oil and oil products are used throughout the world, not only in the United States, making the demand multiplied. As I've stated, the available oil supply is finite at this point while demand grows and oil-market speculators speculate, all driving the price up. Shortages will occur, minus any alleged conspiracy. No one can foresee pipeline disruptions, hurricanes or Venezuela's commie-wannabe president, Hugo Chevaz, going nuts and cutting off oil sales to the United States. While 'alternative fuels' are an attractive idea, and most folks (me included) are open to them, so far, their efficacy has been elusive. Oil and oil products still work best, even at $3.00 per gallon and even in a Ford Mustang Cobra.

I feel that I should state that I hold no oil-related stock of any kind nor do I have a financial (or any other kind) of interest in any oil or energy company in the world. I'm not even related to anyone who does, to the best of my knowledge. I just try to bring some sanity to what is often an emotional discussion where facts and reality go out the window and sheer emotion rules the thought processes of many. It's so easy to get angry at a 'facelesss' oil corporation and fantasize some Dickens-like 'Scrooges' sitting around a boardroom table rubbing their hands together as they plot to jack up prices and collectively 'screw the consumer' while they light therir cigars with $100 bills and laugh. Great fantasy - but hardly close to reality. There is no 'conspiracy', just a free (and very volatile) market.