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Thread: XOM Company Profit about $13,000,000.00 per dead American troop

  1. #21
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    [QUOTE=SINYJets]The consumer isn't being overcharged. There is no such thing when you talk about overcharging in a free market ecomony. You will be charged what you are willing to pay for it. Also, relative to inflation, the argument of overcharging is very weak becuase relative to inflation the price of oil has dropped over the past 20 years.

    There are tons of reasons for the rise in oil prices last summer, which helped Exxon make money. Demand in China, as well as Goldman Sachs' trading of oil futures had a big reason with the rise in prices.[/QUOTE]

    Of course there is such a thing as overcharging. This is especially the case in industries under which the consumers have no choice but to comply. You can argue that people don't HAVE to buy oil, but realistically speaking, yes they do.

    In other types of industries where the corporations don't have huge leverage against the consumers, then the result is simple. If you overcharge, the people won't bother spending their money on your services and you will go out of business. The oil industry is completely different since we have no other choice but to comply to their prices.

    Oil companies are breaking record profits on almost a yearly basis. This has nothing to do with long term inflation and the situation 20 years ago.

  2. #22
    [QUOTE=parafly]Of course there is such a thing as overcharging. This is especially the case in industries under which the consumers have no choice but to comply. You can argue that people don't HAVE to buy oil, but realistically speaking, yes they do.

    In other types of industries where the corporations don't have huge leverage against the consumers, then the result is simple. If you overcharge, the people won't bother spending their money on your services and you will go out of business. The oil industry is completely different since we have no other choice but to comply to their prices.

    Oil companies are breaking record profits on almost a yearly basis. This has nothing to do with long term inflation and the situation 20 years ago.[/QUOTE]

    You do have other choice in terms of transportation. Walk, run, public transportation, bike, there are options out there. You simply choose not to do so. If you have such a problem with how oil companies do business in the states you can do one of two things:
    1. Move to a European country where oil id federally regulated and runs at a price of $7.50 a gallon.
    2. Take advantage of the system and buy shares of oil compaines or put money into energy funds so that when they profit you do to.

  3. #23
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    [QUOTE=Jetdawgg][I]To say that the headline is inflamatory, I would agree[/I]

    That was my quote. It served it's purpose as it caught attention to the fact that these companies have too much influence on our policies.

    What are we to do about it?[/QUOTE]

    I don't know Dog, you tell me.

    After all, since you steadfastly refused to tell me you preferred Democratic Capitalism over Chavez's Populaist Socialism, I can only assume you would prefer a Chavez-like State takeover of the Oil industry.

    And no, your headline did not serve the purpose you think it did. It simply made you look ignorant, and hence made your opinions and posts easier to pass over in the future.

  4. #24
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    [QUOTE=SINYJets]You do have other choice in terms of transportation. Walk, run, public transportation, bike, there are options out there. You simply choose not to do so. If you have such a problem with how oil companies do business in the states you can do one of two things:
    1. Move to a European country where oil id federally regulated and runs at a price of $7.50 a gallon.
    2. Take advantage of the system and buy shares of oil compaines or put money into energy funds so that when they profit you do to.[/QUOTE]

    I don't choose to do anything. With my current situation, I am forced to live in one area and work 40 miles away. There is no public transportation between the two locations. Like I said before, you could argue that people don't HAVE to purchase oil, but realistically speaking, in many cases it is impossible to survive without it.

    The price of oil in Europe is due to taxation. It's a completely different issue than the one being discussed here.

    I do invest. Again, that has nothing to do with the problem of oil companies breaking records year after year.

  5. #25
    [QUOTE=parafly]I don't choose to do anything. With my current situation, I am forced to live in one area and work 40 miles away. There is no public transportation between the two locations. Like I said before, you could argue that people don't HAVE to purchase oil, but realistically speaking, in many cases it is impossible to survive without it.

    The price of oil in Europe is due to taxation. It's a completely different issue than the one being discussed here.

    I do invest. Again, that has nothing to do with the problem of oil companies breaking records year after year.[/QUOTE]

    No you're right supply and demand is why they break records.
    Americans own more cars today than ever before, including SUVs which use alot of gas. So demand is up...meaning oil companies have to pay more per barrel (demand is up all over the thanks to China), meanig they will charge more per gallon. People own more cars, drive more and buy more gas so the oil company makes more revenue.

    Last summers avg rise in price was .80. The average gallon went from about 2.50 to 3.30 a 32% rise. The average barrel went from about $55 to $75 a 36% rise. The companies direct cost was higher than the consumers...meaning the oil company took a greater charge than the consumer. Yes, it's all relative it certainly doesn't hurt them as much as us...but they didn't price gouge...they kept prices relatively level and are making money due to their product being bought more than ever before.

  6. #26
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    [QUOTE=SINYJets]No you're right supply and demand is why they break records.
    Americans own more cars today than ever before, including SUVs which use alot of gas. So demand is up...meaning oil companies have to pay more per barrel (demand is up all over the thanks to China), meanig they will charge more per gallon. People own more cars, drive more and buy more gas so the oil company makes more revenue.

    Last summers avg rise in price was .80. The average gallon went from about 2.50 to 3.30 a 32% rise. The average barrel went from about $55 to $75 a 36% rise. The companies direct cost was higher than the consumers...meaning the oil company took a greater charge than the consumer. Yes, it's all relative it certainly doesn't hurt them as much as us...but they didn't price gouge...they kept prices relatively level and are making money due to their product being bought more than ever before.[/QUOTE]

    A very fair arguement, and like I mentioned earlier, the situation is very complex because of all the global factors associated.

    I have more of an issue with their rise in power, then their rise in profits. One billion more or less in profits is not the end of the world to me. It's the political power gained and their stranglehold on allowing future technologies to flourish that get to me.

  7. #27
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    [QUOTE=parafly]Tying XOM record profits with American deaths in Iraq is ridiculous.

    The real issue here is the question of why these oil companies are making record profit after record profit. The answer is very complex, but using basic economics, one can conclude that the consumer is simply being overcharged. Demand is steadily and rapidly going up, supply has reached a plateau of maximum capabilities, so the price has accordingly gone up. However, there is no reason why profits should be setting records given American's outrage at gas prices and our country's admittance of "America is addicted to oil." In today's world, I feel it is very dangerous for oil companies to be gaining more and more profits as this translates into more and more power, both political and social. Becoming energy independent and transitioning to clean technologies has a LONG way to go because of this power of oil companies.[/QUOTE]

    America's "outrage" is apparently not strong enough to stop us from buying oil. These profits are records only in absolute dollar amounts. XOM's profit [I]margin[/I], a more informative figure to use, is still less than 14%, considerably lower than the average and median margins in many other industries...look it up. The US government still makes more per gallon than oil companies do for every gallon of gasoline sold, actually. XOM is spending more money operating their business and making more money because demand for oil has still been increasing, even though oil prices have climbed (and fallen, and climbed, and fallen). Oil is a highly volatile, risky asset to own and XOM is making money now, even though they have had lean years when gas prices were much lower - the historical average profit margin in that industry is less than 10%. You don't really appreciate the scales involved here, do you? That means that if XOM makes $30 billion in profits for a margin of, say, 15%, they'd have to have spent $200 billion in costs. So, they spend $200 billion and make $230 billion. They have to plan for next year's purchases, try to drill for oil, pay employees, etc and oil is a very volatile asset class...these things obviously mean nothing to you...

    You use words like "outrage" and the fact that the President used rhetorical flair as if those things are actual economic events or terms. You really don't seem to understand economics in any true sense. Also, if we are being over-charged, as you say we are, you think the oil companies should lower prices. This would increase domestic consumption, would it not? How would that make us any more energy independent?

    No offense, but people simply shake their fists at oil companies and they haven't the faintest idea about what they are talking about. Supply has not reached a maximum plateau, either.

  8. #28
    [QUOTE=jets5ever]America's "outrage" is apparently not strong enough to stop us from buying oil. These profits are records only in absolute dollar amounts. XOM's profit [I]margin[/I], a more informative figure to use, is still less than 14%, considerably lower than the average and median margins in many other industries...look it up. The US government still makes more per gallon than oil companies do for every gallon of gasoline sold, actually. XOM is spending more money operating their business and making more money because demand for oil has still been increasing, even though oil prices have climbed (and fallen, and climbed, and fallen). Oil is a highly volatile, risky asset to own and XOM is making money now, even though they have had lean years when gas prices were much lower - the historical average profit margin in that industry is less than 10%. You don't really appreciate the scales involved here, do you? That means that if XOM makes $30 billion in profits for a margin of, say, 15%, they'd have to have spent $200 billion in costs. So, they spend $200 billion and make $230 billion. They have to plan for next year's purchases, try to drill for oil, pay employees, etc and oil is a very volatile asset class...these things obviously mean nothing to you...

    You use words like "outrage" and the fact that the President used rhetorical flair as if those things are actual economic events or terms. You really don't seem to understand economics in any true sense. Also, if we are being over-charged, as you say we are, you think the oil companies should lower prices. This would increase domestic consumption, would it not? How would that make us any more energy independent?

    No offense, but people simply shake their fists at oil companies and they haven't the faintest idea about what they are talking about. Supply has not reached a maximum plateau, either.[/QUOTE]


    It isn't all supply and demand when you have a Cartel like OPEC actively trying to set quota's and prices through collusion and manipulation of supply and demand.

    It's a shame that Exxon gets branded with the hate for doing what they should be doing which is very efficiently bringing a needed commodity to market at an incredibly cheap price that has allowed demand to grow while at the same time generating very nice profits for their shareholders.

  9. #29
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    [QUOTE=jets5ever]America's "outrage" is apparently not strong enough to stop us from buying oil. These profits are records only in absolute dollar amounts. XOM's profit [I]margin[/I], a more informative figure to use, is still less than 14%, considerably lower than the average and median margins in many other industries...look it up. The US government still makes more per gallon than oil companies do for every gallon of gasoline sold, actually. XOM is spending more money operating their business and making more money because demand for oil has still been increasing, even though oil prices have climbed (and fallen, and climbed, and fallen). Oil is a highly volatile, risky asset to own and XOM is making money now, even though they have had lean years when gas prices were much lower - the historical average profit margin in that industry is less than 10%. You don't really appreciate the scales involved here, do you? That means that if XOM makes $30 billion in profits for a margin of, say, 15%, they'd have to have spent $200 billion in costs. So, they spend $200 billion and make $230 billion. They have to plan for next year's purchases, try to drill for oil, pay employees, etc and oil is a very volatile asset class...these things obviously mean nothing to you...

    You use words like "outrage" and the fact that the President used rhetorical flair as if those things are actual economic events or terms. You really don't seem to understand economics in any true sense. Also, if we are being over-charged, as you say we are, you think the oil companies should lower prices. This would increase domestic consumption, would it not? How would that make us any more energy independent?

    No offense, but people simply shake their fists at oil companies and they haven't the faintest idea about what they are talking about. Supply has not reached a maximum plateau, either.[/QUOTE]

    Lower profit margins or not, $40 billion is still a sh!tload of money. I'm pretty sure XON would have no problem preparing for the next year's costs with "only" $30 billion in profits.

    I can't see drastic increases in domestic consumption if oil industry profits remained the same, or at least did not surpass inflation. You tie domestic consumption and energy independence together, but the situation is more complex than that. Energy independence will not rely on lowering domestic consumption, it will rely on changing what we consume.

    I'm not accusing the oil industry of any huge wrong doing. We do live in a capitalistic society and the ultimate goal of any industry is to maximize profits. My issue is more with personal feelings that newer technologies and energy independence will be a tough task to achieve given the current power of the oil industry.

  10. #30
    [QUOTE=parafly]Lower profit margins or not, $40 billion is still a sh!tload of money. I'm pretty sure XON would have no problem preparing for the next year's costs with "only" $30 billion in profits.

    I can't see drastic increases in domestic consumption if oil industry profits remained the same, or at least did not surpass inflation. You tie domestic consumption and energy independence together, but the situation is more complex than that. [B]Energy independence will not rely on lowering domestic consumption, it will rely on changing what we consume.[/B]
    I'm not accusing the oil industry of any huge wrong doing. We do live in a capitalistic society and the ultimate goal of any industry is to maximize profits. My issue is more with personal feelings that newer technologies and energy independence will be a tough task to achieve given the current power of the oil industry.[/QUOTE]

    The only sure way to independence is reduction in usage. The cheapest, easiest way to reduce dependence today is through conservation. The problem with using less oil is it will effectively drive the price down which will stifle innovation of alternative energy. This is why we need to tax the crap out of imported oil and maintain high sustained oil prices.

  11. #31
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    [QUOTE=Winstonbiggs]The only sure way to independence is reduction in usage. The cheapest, [B]easiest way to reduce dependence today is through conservation.[/B] The problem with using less oil is it will effectively drive the price down which will stifle innovation of alternative energy. This is why we need to tax the crap out of imported oil and maintain high sustained oil prices.[/QUOTE]

    That's the key right there. The way to do it TODAY is through conservation. How about 10, 20, 30 years from now?

  12. #32
    [QUOTE=parafly]I don't choose to do anything. With my current situation, I am forced to live in one area and work 40 miles away. There is no public transportation between the two locations. Like I said before, you could argue that people don't HAVE to purchase oil, but realistically speaking, in many cases it is impossible to survive without it.

    [B]The price of oil in Europe is due to taxation[/B]. It's a completely different issue than the one being discussed here.

    I do invest. Again, that has nothing to do with the problem of oil companies breaking records year after year.[/QUOTE]

    Same as in CA.

  13. #33
    [QUOTE=parafly]Lower profit margins or not, $40 billion is still a sh!tload of money. I'm pretty sure XON would have no problem preparing for the next year's costs with "only" $30 billion in profits.

    I can't see drastic increases in domestic consumption if oil industry profits remained the same, or at least did not surpass inflation. You tie domestic consumption and energy independence together, but the situation is more complex than that. Energy independence will not rely on lowering domestic consumption, it will rely on changing what we consume.

    I'm not accusing the oil industry of any huge wrong doing. We do live in a capitalistic society and the ultimate goal of any industry is to maximize profits. My issue is more with personal feelings [B]that newer technologies and energy independence will be a tough task to achieve given the current power of the oil industry[/B].[/QUOTE]

    Everytime the price of oil drops per barrel, the stock prices of alternative fuel sources drops.

  14. #34
    [QUOTE=parafly]That's the key right there. The way to do it TODAY is through conservation. How about 10, 20, 30 years from now?[/QUOTE]

    We have to get off oil. The military is dependent upon it. We need to invest in alternative sources.

    We need to raise the Cafe Standards upon our vehicles.

  15. #35
    [QUOTE=parafly]That's the key right there. The way to do it TODAY is through conservation. How about 10, 20, 30 years from now?[/QUOTE]


    If the price is sustained for long enough at a high enough level people will conserve and at the same time business will invest if they are likely to get a return on that investment. We have an opportunity because there is a cartel actively involved in price collusion to tariff oil coming from Cartel members. By putting a long term high tariff on imported oil, it will impact conservation and innovation for the long run.

  16. #36
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    [QUOTE=parafly]Lower profit margins or not, $40 billion is still a sh!tload of money. I'm pretty sure XON would have no problem preparing for the next year's costs with "only" $30 billion in profits.

    I can't see drastic increases in domestic consumption if oil industry profits remained the same, or at least did not surpass inflation. You tie domestic consumption and energy independence together, but the situation is more complex than that. Energy independence will not rely on lowering domestic consumption, it will rely on changing what we consume.

    I'm not accusing the oil industry of any huge wrong doing. We do live in a capitalistic society and the ultimate goal of any industry is to maximize profits. My issue is more with personal feelings that newer technologies and energy independence will be a tough task to achieve given the current power of the oil industry.[/QUOTE]

    The $200 billion it cost to generate that profit is a sh*tload of money! You truly do not appreciate the scales involved here.

    Of [I]course [/I] the situation is more complex. I was merely responding to your assertion that we are being "overcharged" and the fact that the sole evidence you offered to prove this was some vague sense of "outage" and the fact that a politicians used the word "addicted" in a speech. That's absurd. The way to change what we consume is tied to prices. It's called substitution. I don't consume tons of filet mignon, even though I like the taste, because of its price. Ditto with lobster. If lobster was less expensive, I'd have more of it. I don't consume lots of things because of price. When prices change, people substitute. If you want to change what we consume, what better way to do that that for the price of the undesireable item to go up, making it less likely that comsumption will increase or hold steady? You say we are over-charged on the one hand, yet you say you want us to change what we consume on the other. Those things appear contradictory, since, if you had your way, gas prices would be lower. If that happens, people would consume more gas, not less and that is not what you want.

  17. #37
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    [QUOTE=jets5ever][B]The way to change what we consume is tied to prices[/B]. It's called substitution. I don't consume tons of fillet Mignon, even though I like the taste, because of its price. Ditto with lobster. If lobster was less expensive, I'd have more of it. I don't consume lots of things because of price. When prices change, people substitute. If you want to change what we consume, [B]what better way to do that that for the price of the undesirable item to go up[/B], making it less likely that consumption will increase or hold steady?[/QUOTE]

    Great point Jets5. I wish the price of oil would skyrocket. I hope Ghawar runs bone dry tomorrow, a sort of shock to our system. Get the price per barrel over 100. I'm sick and tired of loud a*s internal combustion engines. I want a damn snow blower that doesn't make me feel as if I have spent the past hour and a half at a Slayer concert with my head inside an amp. I want a lawnmower that doesn't make my nightbird tenants flip me the bird through their drawn shades. I want an ATV that doesn't get the cops called on me every time I ride it under the power lines.

  18. #38
    [QUOTE=parafly]Tying XOM record profits with American deaths in Iraq is ridiculous.

    The real issue here is the question of why these oil companies are making record profit after record profit. The answer is very complex, but using basic economics, one can conclude that the consumer is simply being overcharged. Demand is steadily and rapidly going up, supply has reached a plateau of maximum capabilities, so the price has accordingly gone up. However, there is no reason why profits should be setting records given American's outrage at gas prices and our country's admittance of "America is addicted to oil." In today's world, I feel it is very dangerous for oil companies to be gaining more and more profits as this translates into more and more power, both political and social. Becoming energy independent and transitioning to clean technologies has a LONG way to go because of this power of oil companies.[/QUOTE]

    If the price is high but I'm still willing to pay for it - I'm not being overcharged. If I'm being overcharged, I'll buy less, not more.

  19. #39
    [QUOTE=parafly]I don't choose to do anything. With my current situation, I am forced to live in one area and work 40 miles away. There is no public transportation between the two locations. Like I said before, you could argue that people don't HAVE to purchase oil, but realistically speaking, in many cases it is impossible to survive without it.

    The price of oil in Europe is due to taxation. It's a completely different issue than the one being discussed here.

    I do invest. Again, that has nothing to do with the problem of oil companies breaking records year after year.[/QUOTE]

    Listen, I know oil is so ingrained in our lives that we feel it is neccessary to survive, but it really isn't. Oil isn't vital to live, it just makes our lives a hell of a lot easier. No one is forcing you to live in an area and drive to work.

    If oil ran out tomorrow, we'd survive. It'd be a lot less pleasant, but we'd survive. This entitlement attitude has got to go. We do not deserve cheap energy. We deserve energy at market prices and that's what we'll get.

  20. #40
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    [QUOTE=BrooklynBound]If oil ran out tomorrow, we'd survive. It'd be a lot less pleasant, but we'd survive. This entitlement attitude has got to go. We do not deserve cheap energy. We deserve energy at market prices and that's what we'll get.[/QUOTE]

    I'm not too sure about that. The entire infrastructure of the country is completely dependent on oil. Mass production, distribution, and distant travel would be completely altered, if at all possible. If we suddenly ran out of oil overnight, it would be the spark of a depression unlike anything we've seen before.

    We don't deserve cheap energy? I disagree, in today's modern society, cheap energy is essential. Unless we want to go back to the times of steam powered equipment and wood burning stoves, unaffordable energy if not an option.

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