maybe im the dumb one but it seems that with record profit comes record prices.they seem to hand in hand.if the profit was down and the price was high then we would not have as much to complain about,i think we would still complain.i drive a 94 f150 with 37s on it getting 14 mpg.we could all drive economical vehicles but most of us dont,if the economy changes and we lose the money buffer that keeps some of us driving big suv's and trucks maybe it will be different.remember the 70's,i was a kid so i dont but maybe one of the elder members(said with respect)that can remember those times can let us know how bad the gas bs was it was prices and shortages if i remember correctly.

 

One of the biggest problems I have found is all the excuses that have been used.

If you watched people ask the oil companies why the price is so high from as far back as 4 years ago, once you heard one answer and you called them on it... they would change the answer the next time someone asked.

Question:Why is gasoline already in the ground at the service station allowed to be sold at an inflated rate as opposed to pricing gasoline that cost more to produce that arrives NEW at the underground tank on another day at a higher cost because it cost more ?


Remember this one thing....the price of oil that was listed today was a Speculation for price of oil for January 2007 ...not today

 

Mil1ion, there is a contract price and a spot price for crude. The spot price is the price crude oil is sold at today. Contract price is a price guaranteed for the future. You can buy contract futures for up to 5 years away. If you need to make a product out of crude oil and wanted to guarantee a purchase price for the crude, you can buy a future contract. Or, you can take a chance that the futures contract price is higher than you think it will be on the day you need to purchase the crude, so you can wait and pay the spot price.

The other issue you brought up was the price of gasoline raising for gasoline that is already in the tank at the gas station. Let's say you are a gas station owner. You buy 3000 gallons of gasoline at $1/gallon and you sell it for $1.06/gallon (I'm leaving out taxes in this example). The next day, you see that the price of gasoline now being sold to the gas stations is $1.08/gallon. If you leave the price of your gasoline at $1.06/gallon, you aren't going to have enough money to even buy the next tank of gasoline because you will be in the hole $0.02/gallon. So, in order to be able to buy the next tank of gasoline, you up your price to $1.12/gallon. And on and on.

 

In Calgary service stations (Gas Bars) are told to raise the price by the Oil Company they represent.
I was there one time at an Esso and the guy in the pay booth got the call to raise the price $0.04 L,
Within about 5 minutes the other 2 companies (Shell & Petro-can across the street followed suit).

I thought the oil companies billed their clients every 30-45 days.

Why would they have to have the money at the time of delivery of the next shipment and thus have the time to sell the new stuff at the higher price ?

 

That's his and lots of others problem with oil stations pricing product already in their tanks. Using your example, if a station owner ordered 3000 gal in at $1.00, and priced it for sale at $1.06, then he would make a profit of $180. Then his next tanker load if priced at $1.08 he could price for sale at $1.14 and make the same $180 profit. But noooo way! They want to raise the price of what they already have bought in their tanks thus increasing their profit beyond the $180, and use the lame brain excuse of "Well, how do you expect me to pay for the next transport load if I don't raise my prices on this load?"

And I agree, there seems to be nothing but price collusion going on among the gas stations in each town as they all price their product the same.

 

if the price of gas goes down, then their inventory is worth less. so it's a two way street.

 

When I first started working full time the shop I worked at had their own gas pumps out back. The first hour I had to pump gas and record the tickets so it could be deducted out of their paychecks. Reg was .13 and Premium was .16 Was a heck of a nice deal for all though. For a dollar you could cruise all evening and have a coke or two to boot.

 

13¢ per gallon? Wow, that was awhile ago! They must have still been squeezing oil directly from the dinosaurs back then!

j/k

 

That was funny.