Quote:
Originally posted by Havock:
quote:
Originally posted by Micah Foehammer:
[Phizer:
Revenue $48.371 billions USD (2006)
Net income $19.337 billions USD (2006)
Exxon Mobil:
Revenue: $377.635 Billion USD (2006)
Net income $39.50 Billion USD (2006)
9.86% profit margin
Now tell me who we should be accusing of gouging!
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IMHO , ANYONE who charges enough to turn up BILLIONS in profit should be accused of gouging. I mean realy after taxes and all the bills are paid, the oil industry still turned up 39 BILLION dollars ahead. Profits are all well and good, but there is no need to churn out numbers like that.
It is getting to the point where people can't afford to put gas in the car to get to work ot oil in the tank to heat their homes.
What are they doing with all of thoes billions? They haven't invested in any infrastructure in years so who lives in the mansions while the rest of us work an 80 hour week just to fill up the tank. [/QUOTE]Havock, I'll concede your point about the corporate big wigs making 100's of millions of dollars in compensation as being ridiculous. Okay, that's done. Let's get on to serious stuff.
So simply because a corporation is BIG, and makes a lot of money, it's gouging?Sorry, Havock but I don't agree. Corporations who make REASONABLE RATES of return on the capital they invest are simply not gouging no matter HOW big those profits are. Big companies do make big profits. It's simply a matter of scale! And like it or not, 15% return is NOT gouging. Go ask an investment advisor what a reasonable rate of return is for corporate profits. He'll tell you something like 10 to 15%. The DJIA has returned a historical AVERAGE of 15%.
With all due respect, please do some research with respect to reinvestment. The oil companies ARE reinvesting profits. From 2002 to 2006, they have INCREASED investment in exploration and production alone from 60$ billion dollars a year to 120$ billion dollars a year. That's just to find new oil and produce new discoveries. And some companies ARE reinvesting in increased refining capacity, but it takes time to build new infrastructure and get it online. ConocoPhillips (not who I worked for) -
- spent $4-5 billion to increase the capability of refineries to produce 15 percent more gasoline, diesel and heating oil by 2011.
- $1.5 billion to build new terminals to receive shipments of liquefied natural gas (LNG) from aboard to meet U.S. market needs.
- $20-25 billion for a pipeline to transport natural gas from the Alaska North Slope to the Lower 48 states
That's ONE company. And ConocoPhillips net income was around 15.6 billion dollars.
From Earnst and Lowe, report prepared for the API:
"In the period of 1999 to 3rd quarter 2005, the five major oil companies (BP, Chevron, ConocoPhillips, ExxonMobil, BP, and Royal Dutch Shell) 650 billion dollars in new investment compared to net income of 518 billion dollars". .. "And the 25 largest spend 963 million on net income of 629$ billion."
Source:
http://new.api.org/statistics/earnin...ustry_2006.pdf
That's a reinvestment rate of 120 to 150% of net income!
Want to REALLY bitch about oil prices? Let's ask the US government to follow the example of Germany which has a 2.30$/gallon Excise tax. Or the UK and Australia which weigh in at around 1.65$ or more per gallon PLUS a 18% and 10% Sales tax on top of that. The point of fact is that US consumers have been spoiled rotten for decades with cheap fuel costs. The economic TRUTH is that gas prices in $/gallon WHEN ADJUSTED FOR INFLATION have actually been steadily FALLING (except for the spurt during the oil embargo) since the 1950's until around 2004. That's right, when adjusted for the Consumer Price Index, gasoline was actually cheaper in 2004 relative to total disposable income than it was 50/60 years ago! Since 2004, there has been a dramatic upsurge due to global markets pressures, and yet even with what you see as ridiculously high prices, gasoline costs are on par with the costs in 1960 on a real dollar basis.
Quote:
Originally posted by Seraph:
Iran has a lot of oil, but currently lacks the refinery capability to keep itself supplied with gas. An Iranian oil embargo would likely end up with the west killing the import of gas into Iran, which could lead to something real ugly real fast.
BTW: This problem with gas meshes nicely with the Iranian nuclear program. They've learned their lesson, and do not want to have their energy sources controlled by foreign countries. [/QB]
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The Iranian's have HUGE reserves of Natural Gas. The largest in the Persian Gulf at almost 1 Trillion cubic feet, with over 25% in their South Pars field alone. Development of the reserves has been delayed by various technical, contractual, and political issues. They also have sizable oil reserves of around 136 billion barrels (about half of the Saudi reserves) with refinery capacity of 4.3 million barrels per day and production of 4.1 million barrels per day, and they export 60% of liquids they produce. So they are not producing at refining capacity and they sell off 60% of the refined product anyway. The bigger problem is with their natural gas production. It's very relative to reserves and they consume an extremely large percentage of it internally (100% in 2005) with minimal exports. With Natural Gas reserves of THAT magnitude, Iran doesn't have a resource problem they have a PRODUCTION problem. So explain to me why they need the nuclear program again when they could solve their energy problem with Natural Gas? End of digression ......
[ 07-31-2007, 01:55 AM: Message edited by: Micah Foehammer ]