Oil and Gas Hearings

[Terps]

Has anyone seen the clip of the Senate hearings for the oil and gas executives where Senator Cantwell asks Senator Ted Stevens (R-AK) if the oil executives will have to testify under oath? Senator Stevens refuses her request for them to testify UNER OATH that there has been no price gouging in the market within the last 3 months. Why is it that we can make tobacco executives and baseball players testify under oath in tabacco and steroid cases but we cannot get Oil executives who have made $25 billion over the last 3 months to speak up? Is this fair?

 

[FromTexas]

Has anyone seen the clip of the Senate hearings for the oil and gas executives where Senator Cantwell asks Senator Ted Stevens (R-AK) if the oil executives will have to testify under oath? Senator Stevens refuses her request for them to testify UNER OATH that there has been no price gouging in the market within the last 3 months. Why is it that we can make tobacco executives and baseball players testify under oath in tabacco and steroid cases but we cannot get Oil executives who have made $25 billion over the last 3 months to speak up? Is this fair?

No. It isn't even fair they are being brought into hearings.

 

[Toxick]

Why is it that we can make tobacco executives and baseball players testify under oath in tabacco and steroid cases but we cannot get Oil executives who have made $25 billion over the last 3 months to speak up?

Maybe baseball players and the tobacco industry don't have the werewithal to sufficiently pad the pockets of the relevant Distinguished Gentlemen.

But the oil companies, pulling in record profits, at $30Billion per quater, do.

Is this fair?

NO - I hope they all go to friggin jail.

 

[Terps]

No. It isn't even fair they are being brought into hearings.

You don't think that they should have the hearings with the oil executives despite gas prices skyrocketing and the 5 major oil companies in the US making such a HUGE profit? I fail to see why, do you mind explaining?

 

[vraiblonde]

Is price gouging against the law? I wasn't aware it was. :shrug:

Why are they having these hearings, anyway? I'd like to hear from both sides of the aisle on this issue cause I don't know anything about it.

 

[Toxick]

Is price gouging against the law? I wasn't aware it was. :shrug:

In some states it is.


In the states where it's allowed, I think it should also be legal to hog-tie the price gougers and shoot them in the face with rubber-bands until they stop it.

 

[FromTexas]

You don't think that they should have the hearings with the oil executives despite gas prices skyrocketing and the 5 major oil companies in the US making such a HUGE profit? I fail to see why, do you mind explaining?

Try looking for the appropriate threads in news and current events and here. Kthx...

 

[Terps]

You don't think that they should have the hearings with the oil executives despite gas prices skyrocketing and the 5 major oil companies in the US making such a HUGE profit? I fail to see why, do you mind explaining?

Maybe you are right, I mean it has to be something, b/c just to not have to testify under oath at Senate hearings seems a little fishy to me.

 

[FromTexas]

In some states it is.


In the states where it's allowed, I think it should also be legal to hog-tie the price gougers and shoot them in the face with rubber-bands until they stop it.

Who was price gouging? A few individual gas stations? That isn't the oil industry. Price gouging the cost of barrels of oil? Nope. Price gouging gas futures? Nope. Price gouging the cost of refinement? Nope. Price gouging the cost of tankers? Nope. Price gouging happened... where? Their expenses climbed just as much as their profit... which means they were paying the higher costs, as well.

 

[FromTexas]

Maybe you are right, I mean it has to be something, b/c just to not have to testify under oath at Senate hearings seems a little fishy to me.

Forget to switch mpds?

 

[Toxick]

Their expenses climbed just as much as their profit... which means they were paying the higher costs, as well.

I didn't say they were price gouging - I merely expressed my views on what should happen to price-gougers.


Now as much as I love the oil comanies, and as much as I love giving them as much money as I possibly can just to get to work, it seems the expenses you mentoined were passed on to the consumer, whereas these record-shattering profits were not.


If expenses AND profits skyrocketed, why don't they cancel each other out, and I still pay $1.45 a gallon?

 

[FromTexas]

I didn't say they were price gouging - I merely expressed my views on what should happen to price-gougers.


Now as much as I love the oil comanies, and as much as I love giving them as much money as I possibly can just to get to work, it seems the expenses you mentoined were passed on to the consumer, whereas these record-shattering profits were not.


If expenses AND profits skyrocketed, why don't they cancel each other out, and I still pay $1.45 a gallon?

That doesn't make any sense. Companies aim for a net margin on sales. That is how their business is geared.

For example, I sell widgets. I want to make 10% on every widget sale as my net margin (profit after all expenses). So, if I can assume my expenses per widget are going to be .90, then I price my widget at $1. If the cost of materials goes up, so does the price of my widget. Say it goes up .05, I am not going to keep charging $1 because I have now cut my profit margin in half. I am selling the same amount of widgets (same price should be same demand with all things remaining equal) but I am making less. So, companies aim at the margin they want to make....

So, XOM (Exxon/Mobil) maintains about a 10% net margin. Without going into the hefty numbers, if they took half that net margin (a risk but say they could have done it) you would only have seen about $.05-$.08 less in gas cost and that is being very liberal... Now, they are a corporation, so what happens when they tell their shareholders (who they are legally bound to represent, not you) they decided to take lower than their historical net margin by 5%? Well, their share price plummets, a few lawsuits happen, and in addition, their equity is reduced, loan to equity ratios climb, their borrowing costs thus increase, etc... And all so you can save $.05-$.08?!

So, 90% of what they sold went into expenses and 10% went to net profit. How would that increased expense ever wash with profits when it is a 9:1 ratio?

 

[Bruzilla]

Who was price gouging? A few individual gas stations? That isn't the oil industry. Price gouging the cost of barrels of oil? Nope. Price gouging gas futures? Nope. Price gouging the cost of refinement? Nope. Price gouging the cost of tankers? Nope. Price gouging happened... where? Their expenses climbed just as much as their profit... which means they were paying the higher costs, as well.

Oh please! When gasoline jumps 20+ cents a gallon at the pump overnight... at every station in the same area... without regard to distributor... how can you say there's no gouging going on? The gas that's in those storage tanks was bought for the same spot-market price, so how can you justify charging more for gasoline that's already been paid for? That's called gouging in my book. If you want to charge more for gas you had to pay more for, that's fine, but don't try to charge me more where's there's no justification for it and try to convince me you weren't trying to profit from the crisis.

Also, if the claims of damage from hurricanes being the prime driver for cost increases at the pump are true, unless each distributor was damaged to an equal extent, which is impossible, how could the price increases be the same at every distributor's stations? Some oil companies had significant damage, while some had minor damage, yet all of their products went up to the same price. That's called price fixing in my book.

Lastly, there have been only minimal repairs made to the damaged facilities, yet the availability and refining of crude oil remains constant, and the price of crude continues to go down along with the cost of refined products. How can that be? If the shortage of imported crude and refinery capabilities are what were driving the increased costs, how can the costs be going down when there's been no real change in the status of the facilities? Could it be that it was simple speculation and manipulation of prices that were the prime driver and not damage to facilities??? I think so.

 

[Toxick]

For example, I sell widgets. I want to make 10% on every widget sale as my net margin (profit after all expenses). So, if I can assume my expenses per widget are going to be .90, then I price my widget at $1.

Ok. Fair enough.

If the cost of materials goes up, so does the price of my widget. Say it goes up .05, I am not going to keep charging $1 because I have now cut my profit margin in half.

And I would not expect you to.

I am selling the same amount of widgets (same price should be same demand with all things remaining equal) but I am making less. So, companies aim at the margin they want to make....

Here's what you're conveniently neglecting in your comparison.

Let's say your widgets become so ingrained into society that they're virtually a necessity for day-to-day life.

Let's say further than when the expenses to make your widgets goes up, you also raise your prices to cover the new expenses - and then you tack on another buck per widget for good measure.

You're making profits beyond your wildest imagination.

And the people that rely on your widget to get to work and feed their kids and keep the house warm, have to pay that, or live like it's the 1700's.

But who cares? You're getting yours, right?

 

[SmallTown]

Who is the tard who wants to argue about oil company ethics with someone with the name FromTexas? some battles just aren't worth it.

We should just all be happy that the oil companies were cutting us all a break when oil prices were low.

 

[FromTexas]

Oh please! When gasoline jumps 20+ cents a gallon at the pump overnight... at every station in the same area... without regard to distributor... how can you say there's no gouging going on? The gas that's in those storage tanks was bought for the same spot-market price, so how can you justify charging more for gasoline that's already been paid for? That's called gouging in my book. If you want to charge more for gas you had to pay more for, that's fine, but don't try to charge me more where's there's no justification for it and try to convince me you weren't trying to profit from the crisis.

Also, if the claims of damage from hurricanes being the prime driver for cost increases at the pump are true, unless each distributor was damaged to an equal extent, which is impossible, how could the price increases be the same at every distributor's stations? Some oil companies had significant damage, while some had minor damage, yet all of their products went up to the same price. That's called price fixing in my book.

Lastly, there have been only minimal repairs made to the damaged facilities, yet the availability and refining of crude oil remains constant, and the price of crude continues to go down along with the cost of refined products. How can that be? If the shortage of imported crude and refinery capabilities are what were driving the increased costs, how can the costs be going down when there's been no real change in the status of the facilities? Could it be that it was simple speculation and manipulation of prices that were the prime driver and not damage to facilities??? I think so.

Perception drives the spot market just like any commodities based market. Katrina was an aberration where people got freaked (we saw it all over these forums and other places) and were screaming we were going to be out of gas. That perception was national and fed by the media. Thus, prices rose.

Also, there has been a lot of increased supply from facilities coming back online since Katrina; maybe you just haven't been paying attention. In addition, several reports have come out since Katrina showing oil and gas levels are satisfactory and demand actually decreased due to price allowing for less reduction in supply than perception made out like it would be.

So, like stocks, commodities are driven mostly by what people think the future will be. People are stupid and respond to emotion first and foremost.

 

[FromTexas]

Ok. Fair enough.



And I would not expect you to.




Here's what you're conveniently neglecting in your comparison.

Let's say your widgets become so ingrained into society that they're virtually a necessity for day-to-day life.

Let's say further than when the expenses to make your widgets goes up, you also raise your prices to cover the new expenses - and then you tack on another buck per widget for good measure.

You're making profits beyond your wildest imagination.

And the people that rely on your widget to get to work and feed their kids and keep the house warm, have to pay that, or live like it's the 1700's.

But who cares? You're getting yours, right?

No, you wouldn't expect them to cut their net margin and sink their corporation for $.05-$.08 but you then make a whole argument that they should for the public good? $10 billion seems like a lot, but when you divide it by everything they sell its that $.05-$.08 to you per gallon. Heck, lets say they just gave it all back to everyone in the United States (approximately 296 million). That would be $33 to every man, woman, and child in the U.S. I bet that $33 would go a long way! Now, to top it off, XOM does business in over 70 countries! You ready to break that $33 down to every one of those people who spent money on XOM? Oh! XOM is an American company! Screw those other people!

Don't let the $10 billion make you think big things. We run the biggest deficit ever, too, but compared to historical percentages of GDP, national income, etc... its not that far off. We live in times where corporations are taken over for $10s of billions. You just have to be used to businesses moving in bigger numbers. We are dealing in global markets more and more. You can't just look at it in the small persepective of a dollar figure.

 

[FromTexas]

Who is the tard who wants to argue about oil company ethics with someone with the name FromTexas? some battles just aren't worth it.

We should just all be happy that the oil companies were cutting us all a break when oil prices were low.

Yes, because oil companies are evil.

 

[Toxick]

No, you wouldn't expect them to cut their net margin and sink their corporation for $.05-$.08 but you then make a whole argument that they should for the public good?

That's not what I said.

I said if they're going to pass the Bad-news to the consumer, they should also pass the good-news to the consumer.

Heck, lets say they just gave it all back to everyone in the United States (approximately 296 million). That would be $33 to every man, woman, and child in the U.S.

Except that not every man woman and child in the US drive.
I daresay that most of them don't.

We are dealing in global markets more and more. You can't just look at it in the small persepective of a dollar figure.

I'm not a business man. I don't deal with global markets.

Here's what I know: Oil Companies are racking in INSANE record-breaking profits... they are not breaking even to cover their higher expenses, or even coming out a just weensie-bit ahead. They are blowing the roof off the joint.

Here's what else I know: I'm taking it up the poop-chute every time I pull into a gas-station. And not just the tip, but doodad deep.


Yeah, I feel for the poor put-upon oil companies, being forced into this unfair hearings to answer for that.

 

[Toxick]

Yes, because oil companies are evil.

No, just consumed by greed.