Matt Barrow wrote:

"Dave S" wrote in message
news

Jay Honeck wrote:

Agreed, OT, and just another win for BIG OIL. I hope the senate has a
better handle on what subsidies look like and what profits are for...


Did you READ the article? There hasn't been a new refinery built in the
U.S. since I was a senior in high school -- 29 years ago!

Gee, don't you think that *maybe* we might have gone a wee bit too far
with gubmint regulations?

Yes, Jay.. I read the whole story.. and I knew that fact long before it
was posted in here.. (gasoline refineries). There HAVE however, been all
sorts of OTHER petrochemical units and operations built since then. I
participated in the new construction of a Polypropylene unit a little over
10 years ago. The truth is.. the OLD gasoline refineries were all
grandfathered. They were permitted to operated DIRTY, and CHEAPLY.


No, they haven't; they are just as susceptible to federal and local
regulations as ever.

And older plants are COSTLY to operate, mainly due to maintenance costs.

If they are all so costly, then why havent they built new capacity? The
law doesn't outlaw building them, just says you need to build it to meet
modern environmental standards. That makes the older GRANDFATHERED units
"cheap".



Tis is all about profits.


Or an agenda.


The oil companies havent gone into bankruptcy in droves over 20 odd years,
if anything they have made money hand over fist.


In most years they make less profit than the Feds and states take in fuel
taxes.

Considering in Texas I pay 38.5 cents/gallon in taxes to the State and
Federal Governments on my auto gas, and it's been at that tax rate for a
very long time (years), I am not surprised that the Fed's make more
money on the gas than do the oil companies. When gas was $2.00/gal, that
amounts to 20% going to uncle sam. When its at $3.00/gal like it is now,
the gubmint only is taking in maybe 12% of the gross. Thats just from
the gas sales, and doesnt count taxes paid on the property, inventory
and income by the oil companies to the state, local and federal governments.

I somehow don't feel sorry for the oil companies because they aren't
making a clean 12-20% profit on their product after ALL their expenses.
Saying the companies make less in profit than the government does in
taxes isn't telling the whole story.


They have not increased their refining capacity because it would decrease
their overall PROFIT margin. Building new refining capacity to "standard"
would drive their incremental cost of production UP, and eat into the
stockholders dividends. But make no mistake, it would still be PROFIT.


So why should they use their profits and capital to build more capacity when
so many just squeal and whine?

I didn't say they should. The status quo serves them the best. And now
they are about to benefit (if passed) from legislation that will let
them modernize their capacity (WITHOUT environmental protection
requirements) and improve their profit MARGINS. Perhaps the government
should get into the production and refining business and offer some
"competition" or incentive to the oil industry. Any government profits
could be used to support the general fund or any other lawful government
endeavor.



What we are celebrating is the deliberate browbeating of the elected
Republican representatives of the House by the Republican Leadership. I
will bet dollars to doughnuts that they made it clear - vote against us
and we will REPLACE you at the next election with another fellow
Republican who is loyal. The fact that the election was held open until
the bill passed supports that claim.

You want the truth about oil and gas prices? 5 weeks ago when the oil
prices his $70 or so a barrel, the gas prices popped up over $3 a gallon
within days.


You grasp of an issue with mutiple facets is...lacking.

My grasp is not what the subject is. The truth is, when oil futures
prices rise, the gas prices of current inventory go up right away. When
oil futures prices drop, inventory prices don't decrease in a
correspondingly deliberate manner. Regardless of the causation, or my
alleged grasp, look at what really happens.



The OIL that was that expensive was still to be in the boat being shipped
over from Saudi and Venezuela for days to weeks longer. We paid a premium
on refined product that was already in the inventory. Legalized price
gouging, anyone?


If the market says the next boat load will cost 10-20-30% more, just how
would YOU price your inventory?

I guess if I was a profiteer, I would make ad additional surplus profit
on existing inventory, in addition to making my standard profit margin
on the more expensive stuff once it gets refined and delivered. Lets be
clear.. I am not blaming the end distributors for the pricing of their
product. They are at the mercy of their suppliers. The stations
typically make a few pennies profit per gallon and operate on a very
tight margin between cost and profit. They survive on volume, and
convenience store sales. This rant of mine focuses on the suppliers and
refiners who are responsible for their portion of the present situation.
We havent even begun to discuss the fellow consumers who contribute to
the increased gasoline demand and consumption.


You wanted OT.. you got it


And you're (relatively) clueless.

I've been called worse, by better. Just because I discuss only a few
facets of a complex topic in a usenet rant does not mean ignorance of
other facets. Don't confuse concise with simplistic.

Dave