Comments on: ExxonMobil and Wartime Profiteering http://wdr1.com/blog/2006/10/28/exxonmobil-and-wartime-profiteering/ Screams in the Night Tue, 06 Jan 2009 09:53:19 +0000 http://wordpress.org/?v=2.2.2 By: Poor Working Stiff http://wdr1.com/blog/2006/10/28/exxonmobil-and-wartime-profiteering/#comment-16294 Poor Working Stiff Thu, 12 Jun 2008 02:37:03 +0000 http://wdr1.com/blog/2006/10/28/exxonmobil-and-wartime-profiteering/#comment-16294 The basic figures used in the article are abused. As others have pointed out, the $40.6B in profit is profit on all products world-wide. See http://poorworkingstiff.wordpress.com/2008/06/11/oil-company-profits/ for a more complete explanation, but the profits are closer to 9.5 cents per gallon. The basic figures used in the article are abused. As others have pointed out, the $40.6B in profit is profit on all products world-wide. See http://poorworkingstiff.wordpress.com/2008/06/11/oil-company-profits/ for a more complete explanation, but the profits are closer to 9.5 cents per gallon.

]]> By: Lester Dent http://wdr1.com/blog/2006/10/28/exxonmobil-and-wartime-profiteering/#comment-16291 Lester Dent Tue, 10 Jun 2008 01:58:47 +0000 http://wdr1.com/blog/2006/10/28/exxonmobil-and-wartime-profiteering/#comment-16291 Sorry, this is nonsense. Without getting too wonky (i.e., ExxonMobil pumps over 2 million barrels a day and processes over 6 million bpd, making them a consumer of the world market at the market price, and EM processes only about 3% of the world market), just apply math to the gross sales and profits. In 2007, EM grossed $404.5b and profited $40.9b (http://money.cnn.com/magazines/fortune/fortune500/2007/full_list/index.html). That's about 10 cents on every dollar of sales (of ALL petroleum products, pumping, etc., worldwide). Even assuming the worst-case scenario (all profit came from gas), at $2.81 average price at the pump in 2007, that means the average cost would have been about $2.52 if ExxonMobil had made no profit whatsoever.(http://www.eia.doe.gov/steo) That's with EM buying 66% of its crude at $72 a barrel; what happens when the price goes up to $120 a barrel for the 66% it buys on the world market? It is clear that the oil co's profits are not a major factor in the price at the pump. Whenever you sell a lot of things making a small profit, you make a lot of money. EM sells a *LOT* of gas (as well as making money from many other processes); if EM processed all of the oil it processes into gas for cars, it would have sold 46 trillion gallons in 2007. You sell a trillion of anything and you will make a lot of money. Sorry, this is nonsense. Without getting too wonky (i.e., ExxonMobil pumps over 2 million barrels a day and processes over 6 million bpd, making them a consumer of the world market at the market price, and EM processes only about 3% of the world market), just apply math to the gross sales and profits. In 2007, EM grossed $404.5b and profited $40.9b (http://money.cnn.com/magazines/fortune/fortune500/2007/full_list/index.html). That’s about 10 cents on every dollar of sales (of ALL petroleum products, pumping, etc., worldwide). Even assuming the worst-case scenario (all profit came from gas), at $2.81 average price at the pump in 2007, that means the average cost would have been about $2.52 if ExxonMobil had made no profit whatsoever.(http://www.eia.doe.gov/steo) That’s with EM buying 66% of its crude at $72 a barrel; what happens when the price goes up to $120 a barrel for the 66% it buys on the world market? It is clear that the oil co’s profits are not a major factor in the price at the pump. Whenever you sell a lot of things making a small profit, you make a lot of money. EM sells a *LOT* of gas (as well as making money from many other processes); if EM processed all of the oil it processes into gas for cars, it would have sold 46 trillion gallons in 2007. You sell a trillion of anything and you will make a lot of money.

]]> By: aex3x http://wdr1.com/blog/2006/10/28/exxonmobil-and-wartime-profiteering/#comment-16247 aex3x Sun, 20 Apr 2008 03:45:29 +0000 http://wdr1.com/blog/2006/10/28/exxonmobil-and-wartime-profiteering/#comment-16247 Parent55, Why should the profit per gallon be static? If the demand for gasoline increases or decreases, then exxon's profit per gallon should change. Parent55,

Why should the profit per gallon be static? If the demand for gasoline increases or decreases, then exxon’s profit per gallon should change.

]]> By: Parent55 http://wdr1.com/blog/2006/10/28/exxonmobil-and-wartime-profiteering/#comment-16241 Parent55 Fri, 11 Apr 2008 04:31:03 +0000 http://wdr1.com/blog/2006/10/28/exxonmobil-and-wartime-profiteering/#comment-16241 Brewster, The number may be bogus but his thinking is straight and clear. The oil companies profit should be fixed (by them) at so many cents per unit of product. If they sell more units they make more profit and less if they sell less. The changes in raw material prices (oil prices) should NOT affect the cents of profit per unit sold. The change in the value of the dollar against other currencies (down about 50% now) will cause the price of the raw materials to go up by about 66%, and our cost per gallon of gas at the pump to go up from $2.00 to approximately $4.00 per gallon. But the cents of profit per unit (gallon) sold should stay the same. The recent Congressional hearings completely missed this point (no surprise) and this is the essential measure of whether there is profiteering (price gouging) going on. Brewster, The number may be bogus but his thinking is straight and clear. The oil companies profit should be fixed (by them) at so many cents per unit of product. If they sell more units they make more profit and less if they sell less. The changes in raw material prices (oil prices) should NOT affect the cents of profit per unit sold. The change in the value of the dollar against other currencies (down about 50% now) will cause the price of the raw materials to go up by about 66%, and our cost per gallon of gas at the pump to go up from $2.00 to approximately $4.00 per gallon. But the cents of profit per unit (gallon) sold should stay the same. The recent Congressional hearings completely missed this point (no surprise) and this is the essential measure of whether there is profiteering (price gouging) going on.

]]> By: Brewster http://wdr1.com/blog/2006/10/28/exxonmobil-and-wartime-profiteering/#comment-16156 Brewster Mon, 28 Jan 2008 05:14:26 +0000 http://wdr1.com/blog/2006/10/28/exxonmobil-and-wartime-profiteering/#comment-16156 Someone just posted this guy's comment to a list I read. I can't believe that none of you responders caught his howling error in running the numbers. He assumes (wait for it - this is really hilarious) that 100% of Exxon-Mobil's revenues, and net profits, derive from selling gasoline to consumers at the pump. Not hardly, folks. As a matter of fact, not only do all the big oil companies derive more of their revenues from their other products, like petroleum feedstocks, natural gas etc., but the margins on many of those are better than on gas. So his supposed bottom line cents per gallon of profit is a completely bogus number. Brewster Someone just posted this guy’s comment to a list I read.
I can’t believe that none of you responders caught his
howling error in running the numbers. He assumes
(wait for it - this is really hilarious) that
100% of Exxon-Mobil’s revenues, and net profits,
derive from selling gasoline to consumers at the pump.

Not hardly, folks. As a matter of fact, not only do all the
big oil companies derive more of their revenues from their
other products, like petroleum feedstocks, natural gas etc.,
but the margins on many of those are better than on gas.
So his supposed bottom line cents per gallon of profit is
a completely bogus number.

Brewster

]]> By: wdr1 http://wdr1.com/blog/2006/10/28/exxonmobil-and-wartime-profiteering/#comment-5741 wdr1 Wed, 04 Apr 2007 18:27:02 +0000 http://wdr1.com/blog/2006/10/28/exxonmobil-and-wartime-profiteering/#comment-5741 Bob, I'm with you on the Exon-Mobile bit. However compared to Big Labor, the money corporations give is a pittance. To remove a lot of the corruption in Washington, you'd have to attack it on both fronts. Bob, I’m with you on the Exon-Mobile bit. However compared to Big Labor, the money corporations give is a pittance. To remove a lot of the corruption in Washington, you’d have to attack it on both fronts.

]]> By: Bob Maupin http://wdr1.com/blog/2006/10/28/exxonmobil-and-wartime-profiteering/#comment-5723 Bob Maupin Wed, 04 Apr 2007 06:30:54 +0000 http://wdr1.com/blog/2006/10/28/exxonmobil-and-wartime-profiteering/#comment-5723 Wartime profiteering in rampant. We are in Iraq nee the Mideast for greed disguised in Political-speak as War on Terrorism. Who profits and who pays the bill? The tax payer nee the consummer. Politicians will never kill the goose that continues to lay the golden egg nee PAC aegis. So until Americans place into office a Politician that is not self-serving (Ha, impossible) such graft will continue. Exxon/Mobile is the tip of the proverbial Ice Berg (more like both polar caps than an itty bitty Berg. Perhaps gaining access to the Secret meetings of the Aspen Institute one could find out how long this situation will prevail. Wartime profiteering in rampant. We are in Iraq nee the Mideast for greed disguised in Political-speak as War on Terrorism. Who profits and who pays the bill? The tax payer nee the consummer. Politicians will never kill the goose that continues to lay the golden egg nee PAC aegis. So until Americans place into office a Politician that is not self-serving (Ha, impossible) such graft will continue. Exxon/Mobile is the tip of the proverbial Ice Berg (more like both polar caps than an itty bitty Berg. Perhaps gaining access to the Secret meetings of the Aspen Institute one could find out how long this situation will prevail.

]]> By: Jeremy Leader http://wdr1.com/blog/2006/10/28/exxonmobil-and-wartime-profiteering/#comment-875 Jeremy Leader Mon, 30 Oct 2006 18:27:06 +0000 http://wdr1.com/blog/2006/10/28/exxonmobil-and-wartime-profiteering/#comment-875 Well, a real free-market capitalist would point out that the higher Exxon's profits are, the more incentive there is for the development of alternative energy sources. Well, a real free-market capitalist would point out that the higher Exxon’s profits are, the more incentive there is for the development of alternative energy sources.

]]> By: Arnie http://wdr1.com/blog/2006/10/28/exxonmobil-and-wartime-profiteering/#comment-874 Arnie Sun, 29 Oct 2006 17:13:30 +0000 http://wdr1.com/blog/2006/10/28/exxonmobil-and-wartime-profiteering/#comment-874 Worth noting that Exxon (and the other majors like BP, Chevron, Repsol, Shell etc...) also sell petrol outside the US. The US consumes about 25% of the world's petrol. Exxon's global market share is probably less than 20%, since BP is bigger and those other guys aren't too small either. So the actual profit per gallon is more like in the 35c per gallon range. Worth noting that Exxon (and the other majors like BP, Chevron, Repsol, Shell etc…) also sell petrol outside the US. The US consumes about 25% of the world’s petrol. Exxon’s global market share is probably less than 20%, since BP is bigger and those other guys aren’t too small either. So the actual profit per gallon is more like in the 35c per gallon range.

]]> By: Tim http://wdr1.com/blog/2006/10/28/exxonmobil-and-wartime-profiteering/#comment-873 Tim Sun, 29 Oct 2006 14:25:59 +0000 http://wdr1.com/blog/2006/10/28/exxonmobil-and-wartime-profiteering/#comment-873 What I don't understand is how they make higher profits when oil prices are higher. Assuming their profit is, say, 30 cents a gallon and the price of oil jumps from 60 to 70 bucks a gallon, wouldn't they just factor in the new price of oil and add their 30 cents per gallon profit? For some reason when the price of oil increases they increase their profit margin as well and then act like it's normal business practices. Maybe I'm missing something but that seems totally un-American too. What I don’t understand is how they make higher profits when oil prices are higher. Assuming their profit is, say, 30 cents a gallon and the price of oil jumps from 60 to 70 bucks a gallon, wouldn’t they just factor in the new price of oil and add their 30 cents per gallon profit?

For some reason when the price of oil increases they increase their profit margin as well and then act like it’s normal business practices. Maybe I’m missing something but that seems totally un-American too.

]]> By: brandon http://wdr1.com/blog/2006/10/28/exxonmobil-and-wartime-profiteering/#comment-872 brandon Sun, 29 Oct 2006 04:01:56 +0000 http://wdr1.com/blog/2006/10/28/exxonmobil-and-wartime-profiteering/#comment-872 Wow, so do you propose some government price regulation? How... un-republican of you. Wow, so do you propose some government price regulation? How… un-republican of you.

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