The press does not seem to make the obvious connections THAT US ORDINARY PEOPLE CAN MAKE.The correct headline is:
OIL PRICE KEPT HIGH BY US GAS CARTEL TO JUSTIFY JULY 4th HOLIDAY PRICE GOUGING
The wrong headline is:
Oil drops sharply as supply worries subsideWhose concerns? What disruptions? Cmon Gas Companies. Quit the bizarre doubletalk and just admit it. Just say, We ripped you off over the busy holiday weekend! Ha ha ha.
By ADAM SCHRECK
NEW YORK (AP) — Oil prices tumbled nearly $4 a barrel Monday, erasing many of last week's record gains in a single session as concerns about potential supply disruptions eased...
This is a kneejerk reaction to a dent in your wallet. While understandable, its not accurate. The US Oil companies are tiny compared to the State Oil Companies throughout the world. If all of the US oil companies were amalgamated into one, it would control no more than 5 or 6 percent of the world's oil, hardly able to control world oil prices.
ReplyDeleteAs far as the US Oil companies' profit margin, please note that it is approximately 8.6 percent; it is far smaller than the newpaper and publishing industry which recovers about 20 percent in profits. How about that! The empire controlling the New York Times is more than twice as profitable as US Oil.
Kneejerk? Maybe last year at this time. But not now. We've all had plenty of time to absorb and observe the oil price manipulation. Surely you do not think that there is free competition in the world's oil markets. Everyone has heard of OPEC by now. As Casey Stengel said, "You can look it up." And everyone has been talking about the windfall profits in the oil industry IN THE US! And hey my friends in newspaper publishing will be really happy to hear about their windfall profits - so happy that they won't be able to stop laughing at what you say. While they are crying about their painful losses.
ReplyDeleteHaving fun yet, Rabbi? Well, not for long.
ReplyDelete1. None of the US Companies are members of OPEC; they can't be members thereof.
2. No, I don't think that the global oil market is free. What I said is US Companies don't have the economic clout to impact the global market in any substantial way - not with our current energy policies which are designed to frustrate oil exploration and production.
3. You said "everyone has been talking about the windfall profits in the oil industry IN THE US." You flat-worlders really don't get it. Financial data for the last full year follows:
ExxonMobil
Gross Revenue: 404,552
Net Revenue: 40,610
Ratio: .10
ConocoPhillips
Gross Revenue: 194,495
Net Revenue: 11,891
Ratio: .06
Chevron
Gross Revenue: 220,904
Net Revenue: 18,688
Ratio: .08
4. Here's comparable data from the publishing industry:
Gannet Co., Inc.
(publisher of USA Today and 85 other daily papers)
Gross Revenue: 7,439
Net Revenue: 1,055
Ratio: .14
The New York Times
Gross Revenue: 3,195
Net Revenue: 208
Ratio: .065
That's why every leading economist says there's no oil windfall profits being taken by US Oil. Get real; take a look at the financials some time.
Sorry to rain on your charade.
ReplyDeleteXOM revenue growth 35% in the quarter and that is a laggard in the industry. That is gouging. With military intervention the US under Bush has shown it will use its clout to control Iraq and its oil wealth, the middle East, and to bully anyone else who tries to stop them. Plain fact - US oil companies are planning to take back control of Iraqi oil, nationalized years ago by SH.
Publishing industry revenue growth in the past quarter? NYT -5%; Gannett -8%
Quit trying to con us please.
Don't make the mistake of comparing quarters between industries. Different quarters are important to different industries. The Second and Third Quarters are important to oil, while publishing depends heavily on the Fourth quarter for its yearly profit/loss.
ReplyDeleteGannett Co., Inc.
ExxonMobile
etc.
Look it up yourself.
The last quarter is a case in point. ExxonMobile's Gross Revenue was 116,854.00 while its Net Revenue was 10,890.00. The ration is .093. Exxon's Gross Revenue increase by 35%? Even if your figure is right, so what? It should increase due to the increase of its costs of production.
revenue increases due to costs of production? huh? now you are just making silly things up... pardner: you are being ripped off by greedy texans. if you want to defend them with doubletalk, be my guest, go right ahead, knock yourself out...
ReplyDeleteIts simple. Gross charges for refined product have to take into account the cost of production. If you don't do that, you will probably go bankrupt very fast. Example: ABC Oil Company's pricing model does not consider the cost of production for its gasoline, but prices its refined product at $2.50 per gallon. Now, suppose it costs $3.00 per gallon to manufacture? Obviously, its going to lose $.50 per gallon. Now suppose its Gross Revenue during this period increases, say, 50% and for the sake of argument, that amount is 3M gallons. They would sustain a 50% increase in Gross Revenue and a $50K loss.
ReplyDeleteIf the price of the refined is $3.00 / gallon, the increase of Gross Revenue is still 50%, but there is no profit or loss.
If the price of the refined product is set at $3.50 / gallon, the company receives a $50K profit.
Since you HAVE TO consider the costs of production, any increase thereof will result in an increase in Gross Revenue, but not necessarily Net Revenue.
QED.
Sorry. Should say $500K loss or profit.
ReplyDelete