Thursday, April 27, 2006

peevish on gasoline

Oil industry profits, salaries fuel outrage
WASHINGTON - Thursday, Exxon Mobil announced it had earned $8 billion in profits in the first three months of this year. For outraged consumers, the staggering profit numbers boil down to this: Exxon earned 9.5 cents on every $1 of gasoline and oil sold, cashing in on skyrocketing prices at every stage of the process.
“The big money for Exxon Mobil,” says oil trader John Kilduff of Fimat USA, “is being made by taking crude oil out of the ground and refining it into gasoline and selling it on the street corner.”

I've listened to a sampling of American opinion on gasoline prices over the last few days. People are pissed. And they are quick to blame everybody, anybody, except themselves.

On Seattle talk radio, breathless doomers are wedged in with smug conservatives counting the months until Alaska gets plundered. The oil companies are colluding. The little guy gets screwed. Etc. etc.

So goes the chatter.

Maybe when gasoline hits five dollars a gallon, people will start to look around for structural fixes to their way of life.

Or the whining will just treble in volume. Hard to tell with corn fed, corn fueled, Americans.


At 9:08 PM, April 28, 2006, Blogger WHT said...

You nailed it. We all seem to forget that when the demand curve starts to go vertical, then little fluctuations start to get amplified and we get wild swings in price. People will go insane with prices going up and down, unless they just start thinking calmly about the structural fixes you mention.

At 8:43 PM, April 30, 2006, Blogger Clare said...

I also have been waiting for someone to step up during recent media furor and say "hey, maybe prices are going up because there is more demand than supply!" But that particular basic economic princple seems to be escaping everyone.

Although I did see an article that actually discussed peak oil, though they wanted to put it at 2037 not 2010. Cause then there'd be more time for alternative energy sources to come online...


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