I know that the more laws you make you are only cutting your own throat.
But I don't understand why are the oil companys making so much in profit if they say it cost more to refine the oil?
I know that it's not the president that runs the companys!
2006-07-28 14:21:33 · 10 answers · asked by top momma 3 in Business & Finance ➔ Corporations
While the cat's away, the mice will play. No one in their right mind can justify the record profit that big oil is raking in, while the working man forks over half of his pay for gas!
I am a Bush supporter, but at the end of the day, he is an oil boy at heart. During the Carter (ugh!) administration, billions of government dollars were spent on alternative fuel research. When genuine progress was made, big oil dropped prices like a stone. In doing so, the fledgling alternative fuel businesses were wiped out.
The moral to this story is, don't let anyone tell you that it is disastrous to tamper with the sainted free market. A big tax incentive to alternative fuel announced tomorrow would drop gas prices a full dollar by year's end. Unfortunately, you will not see it during this administration.
I hope this helps.
2006-07-28 15:17:51 · answer #1 · answered by Elwood Blues 6 · 1⤊ 1⤋
Unlike the 70's when oil hit its inflation adjusted all time high because of supply shock, the reason for the current surge in oil prices has been a result of increased demand. Emerging economies like that of India and China are experiencing high levels of growth and need oil to keep their economy running. Also, the instability in the mid-east doesn't help.
Exxon-Mobil, making over a billion dollars a day for the most recent quarter is a lot of money, there is no question, however, no one seemed to care about the oil companies in 1998 when oil was trading for $12 a barrel. Fortunately we live in a capitalist market so if you think the oil companies are making too much money, maybe you should buy an oil stock.......
2006-07-28 21:37:36 · answer #2 · answered by The Time 2 · 0⤊ 0⤋
The website listed below shows the breakdown of the consituent costs of a gallon of gasoline.
Bottom line is, there are a LOT of things that go into the price of gasoline beyond the cost of the crude oil, and many of them reduce the margins on an individual gallon of gasoline, but with the cost of crude as high as it is and the sheer volume of gasoline used on a daily basis in the US, the oil companies are making quite a large profit right now.
The second website (from an oil industry perspective) talks about the way oil (and thus gasoline) is priced.
The third web site provides just about everything you ever wanted to know about oil in general.
Educate yourself about the business...
2006-07-29 13:47:10 · answer #3 · answered by weirina85 3 · 0⤊ 0⤋
Global mega-companies are one of the downsides of capitalism. The oil companies have become so big and spread out around the planet that they really have no allegiance to any country. They serve their stockholders, who are represented by the Boards of Directors.
It is the Board of Directors who decides how much the top executives get paid. Their bonuses are tied to how much money they make for the shareholders. If they see a chance to make a windfall profit, they take it. "Maybe next quarter won't be so good, so if we can make more now, then we're set for the rest of the year."
And when you're talking about executives whose bonuses are in the millions, their greed gets the better of them, I'm afraid.
It is only the government that can stop that abuse. So far, they don't have the stomach for it, though. So we pay.
2006-07-28 22:03:44 · answer #4 · answered by Karl the Webmaster 3 · 0⤊ 0⤋
Milk costs about $3.00 a gallon. See how many miles that will get you. I suppose it would give you enough energy to walk 30 miles ( not recommended in hot or cold weather ). I would rather pay $3.00 for gas and drive 30 miles. On an historical inflationary based price, gas is still not at an all time high.
We live in market driven economy. If the price gets high enough other energy sources will become more economically available. And gee won't that be nice because then we l might help the environment more.
2006-07-29 20:33:40 · answer #5 · answered by Kuntree 3 · 0⤊ 0⤋
It is China and those of us that shop at Wal-Mart. The developing economies need oil and it is the old law of supply and demand. Of course the oil companies should be making money. They carried us through the lean times of the past. I'd suggest a basic course in economics for you. We should have raised taxes years ago to help soften this blow, but Clinton preferred to pass the problem on to us now.
2006-07-28 21:30:53 · answer #6 · answered by gtoacp 5 · 0⤊ 0⤋
The West is dependent on oil and so the Middle East keeps the price low instead of investing in their own countries. Watch the movie Syriana!
2006-07-28 21:26:25 · answer #7 · answered by Anonymous · 0⤊ 0⤋
Anyone ever think that it is investors that are bidding up the price of oil? The more they are willing to pay the more the price will go up.
2006-07-29 02:24:31 · answer #8 · answered by Anonymous · 0⤊ 0⤋
8% of one dollar is 8 cents
8% of a billion is ...
They make a lot of money because they sell a lot of gas.
Their profit margins are no more than others industries .. the profit margins of Goggle, for example, is obscene.
2006-07-28 23:14:45 · answer #9 · answered by anonymous 2 · 0⤊ 0⤋
BUSH AND WARFARE IS NOT FAIR HONK!!!
2006-07-28 21:24:44 · answer #10 · answered by YEAH!!!!! 2 · 0⤊ 0⤋