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Author Topic: Gas prices  (Read 100954 times)
Pheasant Hollow Farm
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« Reply #15 on: April 18, 2008, 07:05:59 AM »

For what it's worth, I have been in the gasoline business in Texas and Louisana for over 30 years. I am a fair sized distributor for several major brands and have a chain of convenience stores. Sell about 11 million gallons a month. All this is sort of like admitting I have leprosy these days. Frankly, it is a crappy business. I am in several other businesses (metal recycling, shopping center development) and all are better than the gas business. I haven't built a new store in years and don't plan to build anymore. Just a poor investment return.

Someone on this thread indicated there is price fixing. Over the years I have been to hundreds of oil seminars. Those guys can't agree on what kind of sandwiches to have for lunch much less get together to fix prices. Remember, it would take everybody, if just one does not, he gets all the business. For about 20 years, I pooled about 10 cents a gallon retail. During the year, I may pool 20 cents for a while, then 5 cents for a while but wound up around 10. Last year I actually pooled 15 cents and my net was less because of credit card fees. So far this year, I am around 16.7 cents pool. But if you come in and fill up on your American Express the credit card fee is around 15 cents a gallon. Try operating on that margin!  A lot more to it than this, you couldn't explain all there is to raising pheasants in one post. Still, not a great business to be in.   

skipper3905,

That would be me. You can't tell me that price fixing doesn't happen. When you have 5 gas stations, BP, Exxon, Chevron, 2 Marathons all have the same price in a 10 mile radius and all 5 lower their price on Wednesday the same amount, only to up the price to the original selling price the following day.

15 miles from me over by my daughter house there is a BP station owned by the same people that is by me. It's the only station on the main drag for 7 miles. Their price is $.05 lower, and they reduce by $.05 on Wednesday as well, and up the price the following day.

I can understand the profit margin, but come on the price increases, 10 to 20 cents within days? if there is a wind storm or if you far^t, they are changing the price at the pumps on fuel that is still in the tanks before there is even a new delivery.  As soon as there is talks about an investigation in price fixing or Price Gouging, all of a sudden the price of gas drops, and the investigation issue becomes moot. It is a cat and mouse game.

Steve
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« Reply #16 on: April 18, 2008, 08:25:32 AM »

$3.24 here in NH
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skipper3905
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« Reply #17 on: April 18, 2008, 11:55:46 AM »

Steve,

You are right, I can't tell you price fixing does not happen. I can tell you I have never seen it happen. As far as how prices react quick, I can tell you how we do it. I own 41 convenience stores. Each store has three key competitors we identify. If any of these key competitors drop the price we match immediately. Going up is slightly different, we wait until two go up then we go up also and give the third one 48 hours, if he does not go up we drop back down to meet his price.

On occasion, there can be a price fight when a new store opens or some other anomily. About a year ago, HEB Grocery and Walmart got in a price fight in Waxahachie, TX and got down to about 25 cents below my cost. I left that one alone. My sales dried up in my store and still have not got it all back. Just could not match the prices. Ours is a volume business, if we do not match prices we lose customers. Customers may like the new place and not come back. Each convenience store is a big investment, I can't let the volume go away and I can't lose money on gas and stay in business. Yes, I make money in the gas business, my stores are paid for and I run a efficient company but if I get to the bottom line with 1.5% of my sales (before federal income tax) I have had a great year. Not much room for mistakes. 

Gas usually goes up or down with crude price. Over the last 20 days or so we have gone from $96 to $115 bbl. That translates to about 42 cents a gallon gas increase. Believe it or not, refiner margins are very low right now. That won't last. Oil is a pure supply and demand commodity. Usually as the price goes up, demand will slack and move price down. Problem is, world demand is going up and oil is a world commodity. China is using 50% more oil every year. Supply is restricted, Russia has a couple of big fields not developed and Canadian oil sands coming along but not much on horizon other than those. American has some big undeveloped fields in California, Florida coast, and Alaska but all off limits to drill. Supply is not meeting world demand and we will see $5 gas within a couple of years. Europeans have had $5 gas a long time and their per capita oil usage is about half of ours. They drive smaller cars, live closer to work, use mass transit and still have a comparable life style. Americans @$$$@ about gas cost but don't do the things that help drive cost down. 

There are lots of price sensitive retail prices that react quickly. For example, if American Airlines drops or increases it's fare $20 from DFW to Washington Dullus, United will usually meet that price within the hour.   
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CharlieHorse
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« Reply #18 on: April 18, 2008, 12:45:21 PM »

Around here the "franchise" sets the price, not the station/store owner/operator, in which make hardly nothing from the fuel sales.  As skipper said, credit card fees alone get more of the profits than any store owner.  Everyone should be using cash instead of giving these credit card corporations all the $$$. 

It isn't the first time it's happened...........remember the 70's?

Oil companies=Government...........one of the same. 
Corporations=Government.........one of the same.  Who owns who?   :-| 
Can't tell the difference...........because there is no difference.

Everybody blames everything on the President, when it's Congress who is calling all the shots.  It's set up that way to divert attention elswhere.   ^-^
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« Reply #19 on: April 18, 2008, 05:52:21 PM »

It went up .20 in 2 days..It is a rip off and no one can tell me any different..When the oil companies went from 16% profit to 200% in one year Hell no body is that dumb..And they say they need that much profit for research that is a bunch of BULL because they know where every drop of oil is in the world right now and have for 50 years..It is NOTHING but a friggin RIPOFF and nothing more nothing...And all the Bast@@ds need to be put in jail...and give nothing but oil to drink. Dont get me started...
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« Reply #20 on: April 18, 2008, 08:43:11 PM »

Slider,     I don't want to get into defending major oil companies but will point out a few things. Their profits have not increased 200% in one year. ExxonMobil is a pretty good barometer. Their proift was $41 billion in 2007, $39 billion in 06, $36 billion in 05, and $25 billion in 04. Most of the oil companies are publicly traded and audited financials are readily available on the web.

Just keep the conversation on Exxon. They paid $30 billion in Federal income taxes in 2007. 81% of Exxon's business comes from overseas. America is the only nation on the planet that requires domestic corporations to pay income taxes on foreign income. What is the solution? Tell Exxon to move to another country? Any country in the world would love to have them with the thousands of high paying jobs. They wouldn't mind that $30 billion in taxes either. Would not be a big chore for Exxon to move overseas, remember only 19% of their income is American anyway. That does not seem quite viable to me.

Then how do we get oil at a price below the world price? We need about 10 million barrels a day over what we produce ourselves. Well, we could declare war on Canada, Venezuela, and Mexico,  defeat them, occupy their countries, seize their oilfields and not pay them squat. That would give us a little over 10 million a day. That would do some damage to our international image, but we sure would be driving cheap.

Maybe just appeal to oil company CEOs to "do the right thing" and cut back on the price of gas. Most oil companies purchase most of their refining stock on the open market so that would not have a big effect but problem is, if I owned stock in any company in any industry and the CEO announced he was not going to make the most money he could for the shareholders I would dump that stock immediately. Every hedge fund, pension fund,  and mutual fund would elect a new board at the next annual meeting and that CEO would be history in a twinkling. Exxon is not the United Way, they are there to make the most money they can for their shareholders.

Maybe just pass a law that says gas can't be sold over $1 a gallon. Doesn't take a rocket scientist to figure out you won't be able to buy gas but the price signs sure would look good. I was in Cuba a while back. They have government set prices on all commodities. Prices are cheap but gas stations don't have gas and grocery stores have empty shelves. Maybe a law saying flight ready pheasant can't be sold for more than 50 cents a bird. Hunters would love it but you would not sell them any  birds.   
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« Reply #21 on: April 19, 2008, 12:02:24 AM »

It is a RIPOFF and nothing more..and if you believe that CRAP that they put out then you are in it with them..They do not pay BEANS in income tax. The only thing that they pay is congress. I do not believe that propaganda CRAP that they put out...I was born at night...but not last night.It is a RIPOFF and nothing more..They get them CEO`s up there and ask them a few simple questions just for show and do not even put them under oath. Now what kind of CRAP is that...you just tell me...and like Steve said they all get together on the same day and raise there prices the same amount.. I just can`t believe that they can think that the American people are that stupid to believe that CRAP....
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« Reply #22 on: April 19, 2008, 12:18:08 AM »

And you forgot to mention that in 2003 their profit was about 6 billion...Which direction is that line going??????????????????????? But O Yea I forgot, they have to do research...Every time the wind changes direction the prices jump..Pipe line in Alaska has a crack in it...prices jump..Flood in South Texas...prices jump...Hurricane in South Louisiana...prices jump...oops another hurricane in South Louisiana...prices jump...earth quake in California...prices jump...UHHHHH where is this picture going????
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« Reply #23 on: April 19, 2008, 08:31:40 AM »

Pay Taxes my A$$ !!!!!!!!!!!!!
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« Reply #24 on: April 19, 2008, 09:02:16 AM »

Quote
Every time the wind changes direction the prices jump..Pipe line in Alaska has a crack in it...prices jump..Flood in South Texas...prices jump...Hurricane in South Louisiana...prices jump...oops another hurricane in South Louisiana...prices jump...earth quake in California...prices jump.

I too wondered why a wreck in the States would make our prices at the pump change....

I think this topic will get many people worked up.

But, "they" do not know where all the oil/gas is. If they did, there would be no more seismic work going on. All seismic companies have been very busy in Alberta. Now that Sask has a new Gov. they are now busy in Sask as well. Saskatchewan has as much, if not more oil and gas as Alberta. Their main problem is, they do not have the infrastructure to move the oil/gas out of Province......yet. Many people up here believe Sask will be the next boom Province. Already land prices have jumped 50% or more.
Last year and likely this year, the oil/gas companies have slowed down. Mainly to get contractors (drilling, construction, pipeline etc etc) to lower prices for the work done. However, you'll not see any relief at the pumps. It will only line their pockets more.

Don't know where things are headed. On TV there was a program about bio fuels. Only thing not covered, was the fact it takes more to make the stuff, than they get out of it ! But it makes them look like "they" are doing something for the global warming folks.
I don't expect to see much change in my life time.....except to pay more for fuels.
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« Reply #25 on: April 19, 2008, 10:41:20 AM »

Slider,      Exxon net income in 2003 was  $21.51 billion, not $6 billion. These things are too easy to check.

Now, if you think the tax amounts Exxon reports are materially misstated, I am going to do you a big favor. Buy a few shares of Exxon stock, get with your personal lawyer, and go to any plaintiff class action firm (the LaRache firm is a very big one). Just tell them you bought your stock in reliance on the public statements and you want a generation fee for a class action suit. This one would be the grandaddy of all class action suits and any law firm would jump on it if there is anything to your idea. I was a CPA in a past life and can tell you this would be increadibly easy to prove or disprove. Exxon can show the canceled checks to the IRS or they can't. That simple!! By the way, you would also sue Exxon's law firm, audit firm, and investment bank. The IRS keeps a few auditors on companies Exxon's size all the time. They would have to be in on this gigantic conspiracy, too. Can get court authority to sue the IRS also.

Over the last few years we are talking about hundreds of billions of dollars in oil company bogus tax reporting that the government could go after. By the way, you would be eligible for a 5% fee from the government on recoveries.   

If you are right, you will be a multimillionaire overnight and hero to all the masses. You will be on TV, have books written about you, and make more money than Bill Clinton on speaking tours.

Well, this is a interesting topic but a gamebird forum. I think I will drop out of this discussion here. 
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Pheasant Hollow Farm
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« Reply #26 on: April 19, 2008, 11:11:12 AM »

skipper3905,

This has as much to do with the game bird industry as does the feed supply, and the delivery of your product(game bird industry). I am not looking for you to make excuses for the oil and gas industry.

Beside, this is the general forum. It is not specifically meant only for the game bird industry, even though every thing can relate to it one way or the other.

Also, it all boils down to the consumer paying the tax on the fuels not the oil company. The oil company is only and agent for the collection.

If it wasn't for the tax subsidies the oil companies are getting they probably would relocate out of the U.S.

In one of your comments:
Steve,

You are right, I can't tell you price fixing does not happen. I can tell you I have never seen it happen. As far as how prices react quick, I can tell you how we do it. I own 41 convenience stores. Each store has three key competitors we identify. If any of these key competitors drop the price we match immediately. Going up is slightly different, we wait until two go up then we go up also and give the third one 48 hours, if he does not go up we drop back down to meet his price.

So then, who is initiating the new price that you all follow? This is still price fixing either way you look at it.

If I say to you, and three other gas stations just off the interstate, lets jack up the price $.02 a cross the board, are you going to do it? I mean what the hell it is only $.02 and it would be considered as a nuance increase. You or I would pay it if we needed the gas. I have no Idea what the price is down the road. 

This is price fixing at its best especially if all the gas stations had the same price. There is no longer any loyalty to one gas maker as it once was. It is now, who has the cheaper gas.

Steve
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« Reply #27 on: April 19, 2008, 06:29:02 PM »

Another .10 today...It ant even raining outside...no prediction of any storms or hurricans no pipelines broken anywhere and the stock market was not even open today so oil did not go up o`well raise it anyway what the Hell  !!!!! O I forgot, maybe it was because the Pope came to visit the U.S.  thats got to be it.....
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« Reply #28 on: April 19, 2008, 11:22:44 PM »

Dag Nabbit!!   



 c49
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« Reply #29 on: April 19, 2008, 11:52:25 PM »

 s020 s020 s020 s020 s020 s020 s020
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