What would gasoline cost in the US be if oil companies made no profit, instead of the billions they make now?

Question

Exxon made approx. 10 billion in profit this quarter. Chevron made about half of that. Spread over all the gasoline sold in the US, how much cheaper would gasoline costs be?

Answer 1

If they agreed toi keep selling it at no profit
probably about 20 percent less.

20% is a typical profit margin for most companies
these days. it used to be about 50% margin
but competition cut it down some.
So that means a $3.00 gallon of gas would cost you
about $2.40

remember also that GASOLENE isn't where they make all the profits. Think about a quart of motor oil.

price about $9.00 a gallon. Or transmission fluid or
other products. even if they only made a profit on gas the profit per gallon isn't that much. Those really big number come from the fact that the consumers (you and I) are USING so much!

Answer 2

It would still cost about the same because prices are set on the GLOBAL market according to supply & demand. Has nothing to do with corporate profits.

I can't defend the profits the majors oil companies are making, and on ethical grounds I wouldn't try (I don't believe anyone can). The fact is, mainland China is RAPIDLY entering the automobile age--they're putting several 1000s of new cars on thier band-new (and rapidly expanding) roadways every month! That old image of China as a place with millions of people scooting around on bicycles is vanishing as more and more cars become available to more and more people who can afford them. And remember, China is VAST in size. So, there's the "demand" side of things.

As for the "supply" part: We've actually been CLOSING oil refineries in this country for the past several decades. According to industry experts, we're something like 24 to 30-something refineries SHORT of what we need...the very numbers of those that were shut down. IF we can get new refineries to open, then the prices could come down...depending a bit on OPEC pricing strategies, of course. I don't know if any of the majors are planning on opening new refineries though...you have to also (and this is absolutely critical!) find new sources of oil beyond OPEC's control. We've got the geologists, geophysicists, and the engineers to do this--and there IS new exploration work going on...but they're mostly looking for gas reserves right now.

It's a mess. Like I said, I can't defend their profits on moral or ethical grounds, but that's all a function of the global supply & demand ratios. Best solution? Alternative fuel that AVOIDS--like the Black Death--switching over to ethanol! Why? You really want more marginal wildlife lands and ag-lands converted to grwing "fuel corn"? It would be an envirnomental disaster.

Answer 3

Short answer is: It would still be more expensive, partly from supply issues as mentioned (the rich folks will not supply things for which there is no profit--they are that ruthless with their greed-head philosophy), but also because it would be *taxed* to the nines like it is in much of Western Europe so that *other* modes of transportation are less expensive in absolute terms and more encouraged....

It's all about a) finding good alternatives to gasoline as a fuel, and b) finding good alternatives to *cars* as basic transportation, and making folks *want* to: walk, ride bikes, get the motor scooters and ride the bus.

Answer 4

well I see varying amounts in how many gallons are in a barrel anywhere from 42 to 55, and a barrel is 70 dollars so it costs them anywhere between 1.60 a gallon and 1.27 a gallon, since I work with paint and we use barrels and I am pretty sure they are 55 gallon drums, I could be wrong but I will check tonight, but either way they are making a good 50% profit if not probably a little bit more, but then again an unknown factor here in this equation is how much it costs to manufacture a barrel of oil, sure wish I had the money to buy my own refinery/oil rig

Answer 5

Profit MARGINS have decreased.
Overall profits have increased, because WE have increased our overall consumption.
Just because you & I pay more per gallon at the pump doesn't mean they are making more money per gallon, they are, however, selling more gallons overall, so their overall profits are up.
If you reduce your consumption, you will reduce your out of pocket costs.

Drive less, drive conservativly, combine trips, drive fuel efficient vehicles.

there are small things that you can do to reduce your transportation costs & save you time & money.

I do all my shopping on the way to work or on the way home, thus saving fuel, by not making extra trips.
I have my paycheck automatically deposited to my checking account, thus saving a trip to the bank ( 15 miles away, highway driving) If I have a check that I have to deposit, I use an ATM that is, again on the way to or from work.
My fuel costs have been greatly reduced, even though the price per gallon has increased.

I have changed my driving habits, I used to take the quickest route & drive fast ( I'm always in a hurry )
I used to drive an average of 20 miles per day in a 6 cyl, 4X4 Ford Escape, I averaged only 12 miles per gallon (well below the EPA rating, not because of the vehicle, but because of where I drive & HOW I drive)
I now drive a Hybrid Escape 4X4
I take my time to drive & I drive more conservativly (this has added only about 2 1/2 minutes to my drive time)
My driving has been reduced by 1/2 by combining trips & shopping locally.
Now I get 29 miles per gallon, without any sacrifice at all.
I can go for a month on a full tank of fuel !!!

By the way, my next tank full, I'm useing a Speedy Rewards coupon good for 50 cents off a gallon !

Reducing the price at the pump to you & I by reducing Their profit margins will do little to your pocket book ....
You can put less money in your tank though, by consuming less.

Answer 6

It would be about $5 a gallon more expensive because there would be no one around to provide it to us. No incentive to sell a product at a no profit margin. Also, about 1/3 of the value of most people's 401K's would go down. Now if you took off the taxes the government makes on it, you would see a difference and they aren't even doing anything to bring it to market.

Answer 7

the real question is how much would gas prices be if the liberals and special interest groups would let us start drilling in Wyoming, Utah, Colorado, Nebraska and Alaska?
they would fall way below 1 dollar per gallon.

Answer 8

Argentina sells it for like 20 cents a gallon..

Answer 9

Some would say lower, some would say higher.

Personally, higher to "justify" all the expenses