When I recently saw the price of Diesel fuel skyrocketing, I did my due diligence and learned both the very small actual added cost of the new low sulphur diesel, and then saw the figures on how much diesel fuel US refineries ship to Europe, I became angry. I’ve wanted a TDI vehicle for years. I rent them in Europe on every trip. They are clean, quiet, and truly gas sippers.
But, I’m now angry at the US oil companies for playing games on fuel pricing before the expected onslaught of TDI vehicles to be delivered.
It made me think. We as citizens have lost the control to monitor and punish bad corporate behavior. Yes, for one day, we can all stop buying gas, but that accomplishes nothing. With oil companies making record profits, these oil companies should be spending record amounts trying to increase supply. They are not from what I read in their corporate reports (at least a number of them).
Ok, after talking to a number of people, I’ve got a solution. We find the oil company with the worst anti-consumer behavior. We as a nation, continent, or concerned group of citizens, decide and pick who that oil company is. We then vow to boycott them. We can explain our motives and I guarantee the other oil companies will start listening to us as citizens again. Shame on powers that be in government, powers that are supposed to protect us as citizens, not help companies find ways to get more money from us as consumers also.
I don’t know who the worst offender is. Can somebody start a website that we can vote on who to boycott???
Consumers have done precisely what you recommend, even without a website. Hugo Chavez has alienated enough people that Citgo owners are feeling the pinch. As has been said here already, oil is fungible so PVDSA (the company that owns Citgo) isn't feeling this at all. They export less to the USA, but all that means is that they export more elsewhere.
Like everyone else, they are making record profits for the simple reason that the demand for oil is high, and growing. What we are seeing at the pump is classic market economics, not market manipulation.
Unlike PVDSA, Citgo owners aren't making record profits. In fact, their current radio advertising in NYC is specifically aimed at people boycotting Hugo Chavez' regime, stating "all you are hurting are local people, and the local economy."
Most people subscribe to the "if you sleep with dogs, you're going to get fleas" mentality. Citgo owners have known about Chavez for a long time, and could have re-branded in the past years.
Absurd solution to boycott one refiner. Best is to reduce consumption by at least 15 percent. Oil companies make about 9 percent on their product. They make their huge income statement profits by FIFO accounting methods. First In First Out cost of crude they buy on the world market. If crude is $100 on week one of their purchase and a week later is $125, all inventory including gasoline reflects the $125 price. Consistent with their practices for many years and IRS compliant. Means that skyrocketing crude costs show up at the pump in a few weeks. Same going down and that happened when crude fell to something like $10. Oil companies got hammered and I don't remember any consumer complaint. USA 2006 cars, SUV's, PU's, vans consumed 136,000,000,000 gallons of gasoline of which 70 percent is from imported crude. USA is a buyer in a sellers market. You voted it that way by ballot and by dollars spent on vehicles and fuel. The Fed helped in this debacle by devaluing the dollar via overnight interest rates. Producers were not about to accept devalued dollars and simply hiked prices. A problem proudly Made in the USA. Next on the Political villain list is speculation. Specifically about 30 percent of US crude futures trading is through InterContinental Exchange in London. Not regulated till agreement last week. Our Politicans are hunting for scapegoats and ICE is it for now. Anything to distract the Peasants from the real underlying supply and consumption problem. A very easy task.
Rants may make everyone feel better, but there is nothing permanent to be done about oil prices. China and India arent going to stop development. Tree huggers, fish lovers, caribou lovers arent going to let anyone drill. No community is going to allow a refinery to be built even if they could drill. Expanding existing refineries is a regulatory exercise. I still dont see much conservation: SUVs still run 85mph going nowhere. Most drivers are either standing on the gas or standing on the brake, racing to the next light. What will it take? $6.00? $8.00? $10.00? Facts will not change anyones habits. The only thing that will change our addiction is $$$. The U.S. auto industry still doesnt get it after 40+ years since VW started writing on the wall. Now that there is a slight lull in the crazy price increases is the time to incrementally add a $2-3 tax per gallon to put the brakes on our foolish consumption.
Tree huggers, fish lovers, caribou lovers arent going to let anyone drill.
The OIL companies have 65 MILLION acres leased to them from the government that they are NOT drilling on right now. They don't have to apply for any permits. They have the rights and leases right now to start drilling tomorrow.
No community is going to allow a refinery to be built even if they could drill.
The BIGGEST group that doesn't want any new refineries are the oil companies themselves. The fewer the refineries the higher the profits. There has been a total of ONE filing for a new refinery in the past 20 years....JUST ONE.
Positive Change; you seem to have succeeded by bringing big oil to its knees! The oil price is now less than $89, down from $147, as we predicted would happen if the world went into a major economic slowdown or recession. You may actually thank the presidents of those irresponsible banks and fincance companies who caused the finacial mess we are in now!
07/07/2008 2:37:25 PM
