Have you, perhaps, noticed that the prices at the pump keep going up? Want to know who to blame? Well, so would most of us, but the big oil companies keep telling us they have nothing to do with it. Even though they are making record breaking profits, that is simply an unintended consequence of market forces that the oil companies simply can't control.
If you want to know just how much bullwhaah
this is, read this article
in The Washington Post
. It explains how Exxon Mobil, the biggest of big oil, uses computer price tracking to make sure that while the company is rolling in money, its station owners do NOT benefit at all. Exxon allows them to make about 8 cents a gallon no matter what. If the owners raise the price by even a penny, then Exxon raises the wholesale price by exactly that penny, often by the next day
Major integrated U.S. oil companies -- which produce crude oil, own refineries and sell gasoline -- have been reaping billions of dollars in profit from high oil prices over the past two years, but they are still working to extract every penny they can from the marketing end of the business. Exxon Mobil doesn't break out its earnings from marketing alone, but its 2007 profits in worldwide refining and marketing -- known as the downstream part of the oil business -- reached $9.6 billion, 43 percent of that coming from the United States.
And if weren't enough, Exxon has started raising the rent on the land the stations are on by roughly a third over the next three years.
But let's get back to Exxon's fine tuning of the prices. One station owner interviewed by the Post
for the article owns five different stations in Northern Virginia, yet Exxon charges him different amounts depending on unstated variables in the market. But ..
... he still cannot fathom how the oil company can charge him different wholesale gasoline prices for each of the five Northern Virginia stations he owns. The stations all sell the same Exxon-branded gasoline, delivered from the same terminal in Newington, where it arrives via the same pipeline. Sometimes, Daggle said, it's even dropped off by the same truck and driver hours apart on the same day.
The only thing that's different is the price, which can vary by 35 cents per gallon, Daggle said. "If I could have driven a truck to Gainesville and drive the gas from there to Shirlington, I could have made 50 cents a gallon."
So, part of that nearly $4 a gallon you are paying is fudgable
; by as much as 35 cents at the whim of the oil company. So what explains that 35 cents?
Every time you and I fill up our tank, we are sending money to a bunch of people who bear us no good will whatsoever and only see us as a bunch of dupes who will pay endlessly for a product whose supply they control. This is as true of the folks who run Exxon Mobil as it is of Hugo Chavez or the Saudi royal family or the mad mullahs of Iran.
And two of our three presidential candidates think it is a good idea to lower our gas tax so you can continue doing this. These clowns have to go. All of them.
Labels: gas prices, greed, presidential campaign