Oil/Gas Prices
- Thread starter djv
- Start date
Thank you GWB ... greedy asshole ... worst president in the history of thte USA! Wish someone would drown him in an oil bath.
Who wrote that article, SDooley? There are some statements and comments made in a rather glossy way that just don't make much sense to me. The simple fact of the matter is that the supposedly increasing cost to keep "pulling out this ever-pricier oil" is nowhere near what the net profits are. How can you draw any other conclusion? Higher taxes? Hmm, how about the tax credits and deductions given to these oil companies thanks to Dick Cheney and the oil executives getting together to form our current energy policy? Does it look like the higher taxes is offsetting all of that? The rising costs of operation due to the rising cost of oil and gas? Hmm, who makes money off that...oh yeah...the oil companies.
Stop and think about it. The highest profits in our history, and costs are causing them problems? How much would they have made otherwise?!? They have set up the current tax system to benefit themselves thanks to carte blanche access to creating legislation. They benefit every day the price of oil remains high, and part of the reason for high oil prices is what...war and fears of war in the world. Who elected to cause this war? That's right, this administration. Coincidence? You can be the judge. Any oil and oil-related interests in this White House? Supposedly oil revenues from Iraq were going to pay for this war. We take over the country and open up control of Iraqi oil to "international companies." Who were those? US and British companies, right? The same companies that are showing record profits and helping keep our costs at the pump high.
Yeah, these oil companies have it really tough.
By the way, when are they going to start building all of those new refineries and distribution facilities after all the tax benefits they received for those purposes? They talk about increased capital spending, but I haven't seen much crowing about what they are actually doing for the money WE are giving them in tax incentives. Wouldn't they be singing those things to high heavens for publicity?!? Or maybe they can't. It's either terrible marketing, or non-existent pure profits thanks to this administration in large part.
I hope these gas prices stay high for the November elections in some ways. I drive two plus hours a day for work, and it would be worth it to see some change in perspective with some of these legislators - and ultimately this White House.
Stop and think about it. The highest profits in our history, and costs are causing them problems? How much would they have made otherwise?!? They have set up the current tax system to benefit themselves thanks to carte blanche access to creating legislation. They benefit every day the price of oil remains high, and part of the reason for high oil prices is what...war and fears of war in the world. Who elected to cause this war? That's right, this administration. Coincidence? You can be the judge. Any oil and oil-related interests in this White House? Supposedly oil revenues from Iraq were going to pay for this war. We take over the country and open up control of Iraqi oil to "international companies." Who were those? US and British companies, right? The same companies that are showing record profits and helping keep our costs at the pump high.
Yeah, these oil companies have it really tough.
By the way, when are they going to start building all of those new refineries and distribution facilities after all the tax benefits they received for those purposes? They talk about increased capital spending, but I haven't seen much crowing about what they are actually doing for the money WE are giving them in tax incentives. Wouldn't they be singing those things to high heavens for publicity?!? Or maybe they can't. It's either terrible marketing, or non-existent pure profits thanks to this administration in large part.
I hope these gas prices stay high for the November elections in some ways. I drive two plus hours a day for work, and it would be worth it to see some change in perspective with some of these legislators - and ultimately this White House.
From Tom Kloza of Oil Price Information Service. Has given out from government how and what's behind the $3.00 gallon of gas.
$1.65 your big companies like Exxon/Mobile. .60 for refineries. 30 to 60 cents state and Fed taxes. Different from state to state. Station owners now as much as 14 cent. At one time as low as 2 cents. Not now. But biggest shame and they don't seem to mind us knowing. Is the big companies Cost of 13 to 24 cents per gallon cost that they are getting $1.65 for right now. Who's screwing who?
$1.65 your big companies like Exxon/Mobile. .60 for refineries. 30 to 60 cents state and Fed taxes. Different from state to state. Station owners now as much as 14 cent. At one time as low as 2 cents. Not now. But biggest shame and they don't seem to mind us knowing. Is the big companies Cost of 13 to 24 cents per gallon cost that they are getting $1.65 for right now. Who's screwing who?
Chadman said:
Article came from BusinessWeek.
Here is a link:
http://www.businessweek.com/investor/content/jul2006/pi20060727_160317.htm?chan=search
Chadman said:
Like I mentioned in the response to Stevie, the big oil companies are just recently beginning to explore and extract the high risk/high cost oil. They need sustained higher prices for these ventures to prove worthwhile and profitable. Or else they would have alot of explaining to do to shareholders.
Chadman said:
I do not know the tax structure and would venture a guess that it is rather complicated. Therefore I won't address something I do not fully comprehend. However, I would agree that they have preferential standing amongst some in this country. Not so in other countries...
"Venezuela is raising taxes as high as 50 percent for Western producers; and Bolivia is taking control of its natural gas fields and threatening to boot out foreigners"
http://www.busrep.co.za/index.php?fSectionId=553&fArticleId=3372862
"Venezuela's president is seeing how far he can push international oil companies such as Exxon Mobil Corp.
In the last several months, Venezuela's government has raised royalties, taxes and government equity in dozens of oil projects. In April, a Venezuelan congressional report urged Mr. Chavez to take similar steps with four heavy oil projects run by multinational companies in the Orinoco River belt, possibly the world's largest oil province."
http://www.tmcnet.com/usubmit/2006/08/02/1764945.htm
Chadman said:
I would caution you to group both the big oil companies and the oil service companies into the same group. I would agree with you that companies with business tied to the oil industry are benefiting. However, a company that makes drilling equipment and generates profit by selling these products to ExxonMobil is a completely different business model then ExxonMobil. This is what I view as the main/most effective point in the article. The large oil companies now have high demand and are competing with each other for equipment. Demand drives up price and thus the increased operating costs. Who benefits from this?---Pipeline companies, drilling equipment manufacturers. So, not sure that I can agree with this statement---
"Hmm, who makes money off that...oh yeah...the oil companies"
Chadman said:
The costs referred to in the article relate to oil under exploration and not the majority of oil in the marketplace.
The shrinking margins talked about address this issue as well.
Example:
(caveat: used round general numbers that are not exact)
Low labor intensive oil costs $20 a barrel to extract and get to market to sell for $70.
Alberta Sands Oil (high labor) costs $45 a barrel to extract and get to market to sell for $70.
The record profits are occurring because the majority of the oil going to the market is still the low labor oil. However, even though there are different classifications/grades of oil it is still a commodity and you cannot charge a premium for it. Meaning there is no added value you can create. So, even though you (the oil company) are paying more to produce the commodity you cannot charge more and hope to survive. Profit margins will be pressured as the high labor intensity oil becomes a higher percentage of the market.
Chadman said:
Its not my intention to argue political points or agendas of administrations. I am trying to put the oil companies and their *current* earnings into perspective and have people look at it from a long-term whole perspective.
Chadman said:
Many examples are out there, but I will highlight this one:
ExxonMobil Announces Third Major Nigeria Startup for Year
07-26-06 10:00 AM EST | IRVING, Texas --(BUSINESS WIRE)--
ExxonMobil announced today that its affiliate, Mobil Producing Nigeria Unlimited (MPN), has started up the East Area Additional Oil Recovery project located approximately 17 miles (28 kilometers) offshore Nigeria. MPN (40 percent interest) is operator of the project with co-venture partner ******** National Petroleum Corporation (60 percent).
The project involves the reinjection of natural gas to mitigate normal field decline from East Area reservoirs and significantly increase ultimate oil recovery from Blocks OML 67 and OML 70. It is expected that the project will produce 530 million gross barrels of additional oil reserves from the blocks, and will provide a peak volume of 120,000 barrels a day of oil. The development also will further reduce routine flaring at the facilities to help meet the ******** government's and ExxonMobil's goals.
Major components of the Additional Oil Recovery (AOR) project include a gas compression complex plus seven associated platforms, including crew living quarters, and more than 100 miles (161 kilometers) of new pipeline for natural gas gathering and distribution. Total cost of the project is expected to be approximately $1.3 billion.
The AOR project is the third major facility startup for ExxonMobil affiliates in Nigeria this year. In February, MPN started production from the full-field facilities of the $1.3 billion Yoho project, with estimated recoverable resources of 440 million oil barrels. Yoho is currently producing about 160,000 barrels of oil a day, and injecting about 110 million cubic feet of natural gas daily. The facilities consist of a central production processing platform, 33 wells, living quarters platform, and a Floating, Storage and Offloading (FSO) vessel. The development is a joint venture between MPN (40 percent) and the ******** National Petroleum Corporation, with 60 percent equity holding.
In March, the deepwater Erha field started production. Together with the Erha North satellite due on-stream in the third quarter of this year, the $3.5 billion Erha and Erha North developments will consist of 32 subsea wells tied to a Floating Production Storage and Offloading (FPSO) vessel. The combined Erha production is ramping up as expected for a total production output of 190,000 barrels a day. Associated natural gas production is expected to be about 300 million cubic feet a day, which will be reinjected for reservoir management.
Esso Exploration and Production Nigeria Limited (EEPNL), an ExxonMobil affiliate, is the operator of the Erha and Erha North developments. EEPNL has a 56.25 percent participating interest in the OML 133 production sharing contract area where Erha and Erha North are located, with Shell Nigeria Exploration and Production Company holding the remaining 43.75 percent.
Chadman said:
Do not want to venture into the political arena, but my daily commute is just shy of two hrs as well and I do not own a hybrid.
One other thing to consider is that these record profits are coming from alot of the mergers of large oil companies in the past decade. It is hard to quantify how many synergies came and are still possibly being realized. However, I think it is safe to assume that larger economies of scale have benefited the oil companies in question.
Very nice response, sdooley. I seriously wanted to know more about what these companies are doing based on what we were asked to help them with. I will look more deeply into your comments and the theories put forth here. I appreciate you putting forth a differing perspective on a very hot subject right now.
pretty sure the PROFIT MARGIN for an oil company is about 10-15 cents/gallon of gas
thus, they are the least to blame for the price
it simply costs a fortune more with instability in the middle east in addition to the increased demand overseas
not much we can do other than to open Manhattan Project II and get us off this gas as it is killing our national security along with the leftist media
thus, they are the least to blame for the price
it simply costs a fortune more with instability in the middle east in addition to the increased demand overseas
not much we can do other than to open Manhattan Project II and get us off this gas as it is killing our national security along with the leftist media
Doc you must not have seen the break down by the state dept guy up above on 3 dollar a gallon oil. Heck of alot more then 15 cents gallon profit.
Well, they must be selling a bazzillion more gallons of gas at 10 cents per in profit to get to their bazzillions in profits the past few months - more than before. Unheard of NET PROFITS...not sure what you are basing your comment on, but that's nothing new.
Well this is a crock of shit. BP shuts pipeline down for corrosion and sludge due to their inability to sweep the pipes like they should have. normal companies were sweeping them every 2 weeks. BP not since 2002. Why should we pay for this mistake. This is rediculous and I think a major scam. **** the oil industry.
