Fighting the Gas Companies

[The Monk]

I don’t know about this but I am sick of waiting for our gov’t to help here. I recently got one of those “please forward” emails talking about reducing gas prices. The general plan is to not buy any gas from Exxon and Mobile the two largest companies. Therefore sooner or later they will have to lower prices. The email talked about how in the past the concept of not buying on a certain day did not really work because the gas companies had nothing to worry about. They know we rely too heavily on their product. But if we concede that point and start selective buying we can force them to change their prices or go out of business. What do you guys think about this?

[jgros001]

I use one of the local companies around me, Carroll Independent Fuel - they are generally 2-3 cents cheaper and 10 cents if you have cash. If there were a reasonable way for me to get to work by subway I would do that as well.

[LT Rich]

Sounds like a valid idea, the only problem is that the whole country will have to know about this and band together. If only a few people start to do it the gas companies wont even notice.

LT

[Hammerhead]

Originally Posted by The Monk

I don’t know about this but I am sick of waiting for our gov’t to help here. I recently got one of those “please forward” emails talking about reducing gas prices...What do you guys think about this?

I think it's bullshit.

http://www.snopes.com/politics/gasoline/gasout.asp

The reality here is that our government is the biggest culprit in high gas prices. Some of this bears further investigation, but here's what I've taken away so far:

1) I'm not positive on this, but oil company profits on a gallon of gas are about $.11 cents per gallon. The federal government makes $.18 cents tax profit, and in New Jersey, the state tax is $.14 cents. NOW who's to blame?

2) The regulations mandating "boutique" fuels for each different market forcing refineries to blend various mixtures of MTBE, Ethanol and assorted other nonsense require that plants make dozens of different blends, driving the price up. Again, government regulations are to blame. The solution is ONE summer blend and ONE winter blend.

3) The environmental whackos have not allowed us to build any new refineries, we can't drill in Anwar, we can't drill offshore, we have emission regulations out the ass, we can't build wind power turbines offshore because some communities refuse to allow them because they spoil the view, and we can't build any new nuclear power plants. All of this drives the price up, too.

4) Part of the problem of increasing price is the increased demand from developing nations like China, which is expanding also.

In short, the oil companies have to live by the same supply and demand laws that every other industry does. I also find it amusing that nobody says anything when oil companies have anemic profits because the price of gas is low. Nobody complains when they invest (literally) billions of dollars in research and plants that get wiped out by hurricanes, or when prices decrease and their profits go down. Oh, no. We only whiine like a bunch of stuck pigs when the price goes up.

I think what we need is a little perspective here. If we enjoyed low prices up to now, we need to just suck it up and deal with the high prices and take the bad with the good. Until the government relaxes the excessive regulation of oil company activities to allow them to respond to market demand, this is what we get from the end result of too much government regulation fiddling with free markets.

[dadof3illinois]

Originally Posted by Hammerhead

I think it's bullshit.

http://www.snopes.com/politics/gasoline/gasout.asp

The reality here is that our government is the biggest culprit in high gas prices. Some of this bears further investigation, but here's what I've taken away so far:

1) I'm not positive on this, but oil company profits on a gallon of gas are about $.11 cents per gallon. The federal government makes $.18 cents tax profit, and in New Jersey, the state tax is $.14 cents. NOW who's to blame?

2) The regulations mandating "boutique" fuels for each different market forcing refineries to blend various mixtures of MTBE, Ethanol and assorted other nonsense require that plants make dozens of different blends, driving the price up. Again, government regulations are to blame. The solution is ONE summer blend and ONE winter blend.

3) The environmental whackos have not allowed us to build any new refineries, we can't drill in Anwar, we can't drill offshore, we have emission regulations out the ass, we can't build wind power turbines offshore because some communities refuse to allow them because they spoil the view, and we can't build any new nuclear power plants. All of this drives the price up, too.

4) Part of the problem of increasing price is the increased demand from developing nations like China, which is expanding also.

In short, the oil companies have to live by the same supply and demand laws that every other industry does. I also find it amusing that nobody says anything when oil companies have anemic profits because the price of gas is low. Nobody complains when they invest (literally) billions of dollars in research and plants that get wiped out by hurricanes, or when prices decrease and their profits go down. Oh, no. We only whiine like a bunch of stuck pigs when the price goes up.

I think what we need is a little perspective here. If we enjoyed low prices up to now, we need to just suck it up and deal with the high prices and take the bad with the good. Until the government relaxes the excessive regulation of oil company activities to allow them to respond to market demand, this is what we get from the end result of too much government regulation fiddling with free markets.

Great post, these are very true and real issues.

[carbonbased_al]

Originally Posted by Hammerhead

I think it's bullshit.



The reality here is that our government is the biggest culprit in high gas prices. Some of this bears further investigation, but here's what I've taken away so far:

1) I'm not positive on this, but oil company profits on a gallon of gas are about $.11 cents per gallon. The federal government makes $.18 cents tax profit, and in New Jersey, the state tax is $.14 cents. NOW who's to blame?

Agreed. Whats sick is Jersey is like the third lowest in terms of gas tax too.

[jgros001]

Originally Posted by Hammerhead

I think it's bullshit.

http://www.snopes.com/politics/gasoline/gasout.asp

The reality here is that our government is the biggest culprit in high gas prices. Some of this bears further investigation, but here's what I've taken away so far:

1) I'm not positive on this, but oil company profits on a gallon of gas are about $.11 cents per gallon. The federal government makes $.18 cents tax profit, and in New Jersey, the state tax is $.14 cents. NOW who's to blame?

2) The regulations mandating "boutique" fuels for each different market forcing refineries to blend various mixtures of MTBE, Ethanol and assorted other nonsense require that plants make dozens of different blends, driving the price up. Again, government regulations are to blame. The solution is ONE summer blend and ONE winter blend.

3) The environmental whackos have not allowed us to build any new refineries, we can't drill in Anwar, we can't drill offshore, we have emission regulations out the ass, we can't build wind power turbines offshore because some communities refuse to allow them because they spoil the view, and we can't build any new nuclear power plants. All of this drives the price up, too.

4) Part of the problem of increasing price is the increased demand from developing nations like China, which is expanding also.

In short, the oil companies have to live by the same supply and demand laws that every other industry does. I also find it amusing that nobody says anything when oil companies have anemic profits because the price of gas is low. Nobody complains when they invest (literally) billions of dollars in research and plants that get wiped out by hurricanes, or when prices decrease and their profits go down. Oh, no. We only whiine like a bunch of stuck pigs when the price goes up.

I think what we need is a little perspective here. If we enjoyed low prices up to now, we need to just suck it up and deal with the high prices and take the bad with the good. Until the government relaxes the excessive regulation of oil company activities to allow them to respond to market demand, this is what we get from the end result of too much government regulation fiddling with free markets.

The only problem is you cannot compare oil/gas prices to everything else because it affects the prices of everything. Shit, Aristocrat humidors went up by $50 because of gas prices. It is not just about me getting to work - and I don't think people should just "suck it up".

[dadof3illinois]

Originally Posted by jgros001

The only problem is you cannot compare oil/gas prices to everything else because it affects the prices of everything. Shit, Aristocrat humidors went up by $50 because of gas prices. It is not just about me getting to work - and I don't think people should just "suck it up".

This isn't all true. Remember, we still import a very large amount of our products by barges and tankers. The transportation costs are also included in gas/oil prices just as your Aristocrat humidor!!!

[Hammerhead]

Originally Posted by jgros001

The only problem is you cannot compare oil/gas prices to everything else because it affects the prices of everything. Shit, Aristocrat humidors went up by $50 because of gas prices. It is not just about me getting to work - and I don't think people should just "suck it up".

The other way to look at this is that Aristocrat humidors have been $50 underpriced until this price change, because of the low cost of fuel since the 1980's, and the price is just now normalizing.

[Jeff]

The current gasoline tax in PA is 25.9¢/g. Its hard to stomach the fact one pays a quarter more for every gallon because of the tax.

I don't know how the roads are in some of the other states, but they are in terrible condition in PA. So where the heck does all that cash go?

[justinphilly]

i say we all just park our cars, and stay on Club Stogie FOREVER!!

[Alpedhuez55]

Driving less is all you can do. I have not been able to drive since my accident. have probably saved over $100 in the past three weeks!!!

[chip]

We have enjoyed low prices on gas for so long that we expect it now. Compare our prices to the rest of the world, and understand we import 60% of our needs because of poor planning and regulations. Yes, it is a hardship, but so what? If it gets people to recognize the poor policies and planning by our elected incompetents, maybe we can get back on track.
When it takes billions of dollars to invest in "alternative" energy, what is the incentive for the few companies that can afford it?
This reminds me of the stupidity in telecom regulations......"hey ma, get the checkbook, we gonna start a phone company!".

[Mbraud4]

Originally Posted by justinphilly

i say we all just park our cars, and stay on Club Stogie FOREVER!!

[jgros001]

A couple of thoughts...

It is not all about prices at the gas stations. Higher oil/gas prices will (and have) result in higher prices on almost all products including food. So people now have to cut back on what they purchase, necessities. Businesses that don't provide these items lose customers. This equals cutbacks, unemployment, etc. In the short run, the economy can handle it. Long run, it can lead to a recession. Maybe we have enjoyed lower prices compared to the rest of the world - but the economy cannot handle sharp jumps in prices across the board.

My impressions, the gas companies have no incentive to invest back into the businesses with better refineries. They take the profits and put it into their own pockets rather than reinvest. They have a great incentive to have high costs and less product. They do not lose out either way - unless someone comes up with a viable alternative. This is not likely in the short run. Ok, so there are hybrid cars - they are in the minority. And anyone who requires a large car is left with very few choices.

The "deal with it" argument just will not work for a large portion of the country. This will require more government spending and higher taxes to handle that problem.

Just a couple of thoughts to consider.