The Gas Thread Revisited

[IceHogsFan]

So is POTUS and Congress going to get serious about the price of gasoline at the pumps or will this just become more political fodder where they attack "the evil gas companies who make ridiculous profits"? I would enjoy hearing more about and see action taken against the commodities markets which IMO is the real culprit behind the spike in prices.

But this week, as oil prices fell and fell and fell, the administration was quick to put Attorney General Eric Holder and White House press secretary Jay Carney out with a message to Big Oil that Washington was not going to brook any lollygagging on getting those gasoline savings to voters, er consumers.



Carney said the administration will "make sure that we don't have what I've heard described as a 'rockets-and-parachutes phenomenon,' where prices at the pump rocket up when oil prices rocket up, and yet they come down in a parachute fashion when oil prices go down."



Wonder how that rockets-and-parachutes phenomenon will affect Obama's poll numbers.



Obama, taking aim at Big Oil, says gas prices hurt



President Obama said Friday that high gasoline prices are sapping the spending power of Americans, as he tried to limit political fallout by linking it to public hostility toward oil companies. "We've got high gas prices that have been eating away at your paychecks, and that is a headwind that we've got to confront," Obama told auto plant workers. Opposition Republicans have sought to cast blame on the Democratic president for a surge in gas prices that is straining Americans' pocketbooks at a time of sluggish economic recovery.



http://my.news.yahoo...-014827313.html

 

[bri]

I have seen no drop in prices at all. It went up another dime last week. $4.19 for regular and $4.29 for super. I am tired of being screwed and not getting to enjoy it.

 

[TSD]

It's really a combination of the two. While the commodities market shares its part of the blame for trying to artificially profit and scare up the price per barrel. When oil prices rise i dont blame the fuel companies who raise gas prices to compensate.



HOWEVER.



may 2008

Oil price per barrel: $145.

Average Price at the pump: $4.00



May 2011

Oil price per barrel(as of a few mins ago): $100 (it was actually $99, I rounded up)

as of may 6, the average price at the pump was yep: $4.00(I wish I was paying that)



this makes absolutely no economic sense. we have the same national average at the pump for a 45% difference in price per barrel of oil.....



You do, unfortunately have to start questioning the gas companies at this point and whether they are charging this much simply because they have done it before and people still went to the pump, so they know they can.

 

[bri]

Anybody that thinks the oil companies aren't getting fat off this is delusional. They are greedy bastards that take every opportunity to screw the American people for their own gain.

 

[IceHogsFan]

It's really a combination of the two. While the commodities market shares its part of the blame for trying to artificially profit and scare up the price per barrel. When oil prices rise i dont blame the fuel companies who raise gas prices to compensate.



HOWEVER.



may 2008

Oil price per barrel: $145.

Average Price at the pump: $4.00



May 2011

Oil price per barrel(as of a few mins ago): $100 (it was actually $99, I rounded up)

as of may 6, the average price at the pump was yep: $4.00(I wish I was paying that)



this makes absolutely no economic sense. we have the same national average at the pump for a 45% difference in price per barrel of oil.....



You do, unfortunately have to start questioning the gas companies at this point and whether they are charging this much simply because they have done it before and people still went to the pump, so they know they can.

Great points



My concern is that politically we will hear more of the same from this administration about profits, CEO pay, bonuses, etc. to continue on the path of class warfare instead some actual involvement in getting the issue resolved. I enjoyed your price per barrel vs. gallon at the pump comparison.

 

[IceHogsFan]

Anybody that thinks the oil companies aren't getting fat off this is delusional. They are greedy bastards that take every opportunity to screw the American people for their own gain.

Keep in mind that the federal government gets 18.4 cents per gallon for each gallon of gas you pump along with the State of Illinois that gets 6.25% sales tax and .3 % tax for underground storage tank fund, and other local sales and gasoline taxes. Diesel fuel taxes are 27.5 cpg for commercial highway users.



Almost 6 and a half percent to the coffers of Illinos of each gallon purchased. Hmmmmm, and where is the incentive for the State to address the rise in fuel prices????



http://www.gaspricewatch.com/usgastaxes.asp

 

[TSD]

Great points



My concern is that politically we will hear more of the same from this administration about profits, CEO pay, bonuses, etc. to continue on the path of class warfare instead some actual involvement in getting the issue resolved. I enjoyed your price per barrel vs. gallon at the pump comparison.

I agree it shouldn't be turned into an overall war against big business. As i said, when speculators drive up oil prices, i dont blame the fuel providers for compensating, they are a business afterall.



But in the here and now, in this single situation, with supply a relative constant, demand actually waning, ppb 45 dollars lower than 2 years ago, yet they are charging the same at the pump as 2 years ago? you kind of have to throw up a big WTF!? to exxon mobil, bp and the like on that one. I am all ears, if said companies ant to give me a reason the cost of oil is cheaper yet they are charging the same at the pump as two years ago.



I mean give me something, production, distribution costs are higher, (which I have heard nothing of the sort), BP's trying to make the money back for ruining the gulf coast, whatever. If not I have no other option but to believe they are price gouging the lot of us.

Keep in mind that the federal government gets 18.4 cents per gallon for each gallon of gas you pump along with the State of Illinois that gets 6.25% sales tax and .3 % tax for underground storage tank fund, and other local sales and gasoline taxes. Diesel fuel taxes are 27.5 cpg for commercial highway users.



Almost 6 and a half percent to the coffers of Illinos of each gallon purchased. Hmmmmm, and where is the incentive for the State to address the rise in fuel prices????



http://www.gaspricewatch.com/usgastaxes.asp

I agree with you there, the government could take one for the team there, but we know the government sucks, and it just means something else is going to suffer for it, if they lowered or eliminated gas taxes.

 

[jakobeast]

Keep in mind that the federal government gets 18.4 cents per gallon for each gallon of gas you pump along with the State of Illinois that gets 6.25% sales tax and .3 % tax for underground storage tank fund, and other local sales and gasoline taxes. Diesel fuel taxes are 27.5 cpg for commercial highway users.



Almost 6 and a half percent to the coffers of Illinos of each gallon purchased. Hmmmmm, and where is the incentive for the State to address the rise in fuel prices????



http://www.gaspricewatch.com/usgastaxes.asp

Let's not forget for some on here, you are paying tax on top of tax. There is a Cook county tax as well that adjusts with the pice per gallon that includes the Federal tax.

 

[jakobeast]

I heard a fella on the radio talking about the idea of paying a gas tax per mileage, not per gallon. The argument was being made as there are more hybrids on the road, using less gas, and electrics are gaining in popularity, and other alternate fuels such as hydrogen and some others on the horizon. Which in turn leads to less monies collected by the gubermint, which of course goes to upkeep the existing infrastructure and building of new roads.



They would install a device that would monitor you mileage, and once a year, or quarterly or whatever, you would go and let them read the device and you would pay the tax from that.



To that I say, yeah right, good luck.

 

[IceHogsFan]

I heard a fella on the radio talking about the idea of paying a gas tax per mileage, not per gallon. The argument was being made as there are more hybrids on the road, using less gas, and electrics are gaining in popularity, and other alternate fuels such as hydrogen and some others on the horizon. Which in turn leads to less monies collected by the gubermint, which of course goes to upkeep the existing infrastructure and building of new roads.



They would install a device that would monitor you mileage, and once a year, or quarterly or whatever, you would go and let them read the device and you would pay the tax from that.



To that I say, yeah right, good luck.

Scary stuff, eh?



Government wants more and more of our incomes and even when revenues fall for the right reasons they still want to increase our taxes to replace that tax. Your example is a good point Jako. Would the government still need to collect the underground storage fee if there is less fuel utilized meaning less need for tanks? Everyone thinks their "little" tax does not make a difference but taxes are never rescinded only added to.

 

[jakobeast]

Scary stuff, eh?



Government wants more and more of our incomes and even when revenues fall for the right reasons they still want to increase our taxes to replace that tax. Your example is a good point Jako. Would the government still need to collect the underground storage fee if there is less fuel utilized meaning less need for tanks? Everyone thinks their "little" tax does not make a difference but taxes are never rescinded only added to.

Nevermind anything else, this just proves that taxes as they are now are flawed. When gas prices shoot up, so do the taxes, and many folks start driving differently. driving less, driving alternative fuel cars, and so on. That means less taxes are collected, leaving the gubermint to freak out.



A flat tax would mean more people paying into the system. I don't know what that number would be. Let's just say for sake of argument it's 10%. If you get more people paying in, at less of a burden, and you have more money. Both you and the gubernmint.

 

[Tater]

Nevermind anything else, this just proves that taxes as they are now are flawed. When gas prices shoot up, so do the taxes, and many folks start driving differently. driving less, driving alternative fuel cars, and so on. That means less taxes are collected, leaving the gubermint to freak out.



A flat tax would mean more people paying into the system. I don't know what that number would be. Let's just say for sake of argument it's 10%. If you get more people paying in, at less of a burden, and you have more money. Both you and the gubernmint.

A flat tax makes too much sense therefore it won't happen.

 

[LordKOTL]

I know Washinton a number of years back had a tax on the registration of vehcles based on KBB price. Now, that in and of itself might have not been a bad idea, but when I was paying $600 a year to register a $2000 KB value car, and many people apying over $1000/year (Washington re-registers every year), the law was soon overturned by the populace and the state government had to make up the difference in a gas tax and a "sin" tax (Tobacco and Alcohol). This forced many people to then fill up on Oregon, where even though you have to pay someone to pump your gas, the tax made gas cheaper here.



My opinion is that no options will really work. Thinking about Chicago, if the gas tax goes too high, and Indiana is less, the state will lose revenue since Indiana is not too far (at least I remember it that way...yeah, 25 miles). Placing a tax on vehicle registration will force more people on public transit and possibly opening up the door for companies like Flexcar and Zipcar. Same with Mileage taxes. And the best option; cutting the politicans' salaries...well, we can dream, can't we?

 

[Tater]

To add to LordKOTL's post, it's similar with other taxes too.

With Quinnocchio raising taxes business' threaten to leave (see Sears HQ, especially true after their original tax break expires).

What will now happen, he'll give them a huge tax break while the rest of us are stuck with our increases.

 

[BigPete]

Here is the solution plain and simple to avoid the rocket symptoms.



Do not allow gasoline to be traded on the market as a commodity. Do not allow barrels of crude oil to be traded on the market as a commodity.



WHY?



Well here is a quick lesson on what happens. Saudi (for instance) pumps the oil out of the ground. US oil company X buys it and ships it over to America where it is refined. Then US oil company X sells it as a commodity or 'future' to a stock purchaser who has two options, sell it to someone else at a profit (another investor) OR sell it to a chain of gasoline suppliers at one of the major pipeline distribution hubs. If it is getting sold en route to the distro hub by multiple investors then the price keeps going up. Once it gets to the distro hub it is bought by a gasoline supplier and sold to gas stations. This is what sets the price at the pump as most of the gasoline supplies also own some gas stations.

The other price setting mechanism is with the crude oil barrels coming out of 'Saudi' and being bought then shipped by investors who sell it to refineries here in the states. This is very similar to the gasoline price setting concept discribed above.



So, as I have long maintained, take gasoline off of the commodities market as step one. Step two will require that US oil companies can not price gouge or participate in 'rocketting up' the price per gallon, this calls for legislation and dicks around with 'free market economy'...oh well.

 

[LordKOTL]

Here is the solution plain and simple to avoid the rocket symptoms.



Do not allow gasoline to be traded on the market as a commodity. Do not allow barrels of crude oil to be traded on the market as a commodity.



WHY?



Well here is a quick lesson on what happens. Saudi (for instance) pumps the oil out of the ground. US oil company X buys it and ships it over to America where it is refined. Then US oil company X sells it as a commodity or 'future' to a stock purchaser who has two options, sell it to someone else at a profit (another investor) OR sell it to a chain of gasoline suppliers at one of the major pipeline distribution hubs. If it is getting sold en route to the distro hub by multiple investors then the price keeps going up. Once it gets to the distro hub it is bought by a gasoline supplier and sold to gas stations. This is what sets the price at the pump as most of the gasoline supplies also own some gas stations.

The other price setting mechanism is with the crude oil barrels coming out of 'Saudi' and being bought then shipped by investors who sell it to refineries here in the states. This is very similar to the gasoline price setting concept discribed above.



So, as I have long maintained, take gasoline off of the commodities market as step one. Step two will require that US oil companies can not price gouge or participate in 'rocketting up' the price per gallon, this calls for legislation and dicks around with 'free market economy'...oh well.

In full agreement. But allowing stuff like this, or by saying that all health insurance companies have to be nonprofit, will get people calling you a communist.



And to that I say: "Do svidaniya, Tovarish!"

 

[MassHavoc]

In full agreement. But allowing stuff like this, or by saying that all health insurance companies have to be nonprofit, will get people calling you a communist.



And to that I say: "Do svidaniya, Tovarish!"

Yeah, you beat me to it, while I agree it should be taken off the market, and any middle man cut out, the second you open a box like that, you are giving the government the ability to apply that power to other markets. Next Milk, then OJ, then beef, then... I don't know i've fun out of ideas. I don't feel well.

 

[BigPete]

In full agreement. But allowing stuff like this, or by saying that all health insurance companies have to be nonprofit, will get people calling you a communist.



And to that I say: "Do svidaniya, Tovarish!"

Privyet Comrade! HAHAHAHAHAHA

 

[ginnie]

You guys shouldn't complain - Canada produces more than it consumes - we export a million or so barrels a day to the States ... and our gas prices are higher than yours : $5.23 a gallon

 

[MassHavoc]

You guys shouldn't complain - Canada produces more than it consumes - we export a million or so barrels a day to the States ... and our gas prices are higher than yours : $5.23 a gallon

Which is another reason I'm so fucking tired of gas prices being blamed on turmoil in the middle east. Canada is the number one producer of US oil. We need to get it over with and invade.