dunno if it will effect the US, but BP is in the midst of the strike in Scotland at one thier refineries.

 

SS, if its possible or if you care to link to some articles I'll be glad to read anything that supports your position.

 

I swear without naming names this is aimed squarely at me - since I seem to run my mouth to most about taxes. So let me state my exact position on taxes - I'm not anti-tax (I know we've got bills to pay for the services rendered) - I just think there is a better way to collect taxes, our tax system is crap and it $h!ts on everbody in the middle while favoring opposite ends of the spectrum. I just want a level playing field for everybody - there is no way our current tax system does this, its all about control and pandering (I've said before that I oppose the current tax breaks big oil gets, the industry is healthy so it doesn't need them.)

Wasteful evil government, well you got me there on the wasteful part - when government is spending money outside the few things you've listed I dont like it. This is primarily entitlement spending - (roads to nowhere, BS thinktanks, tapping into miracle energy sources like the aurora borealis <--- if anybody remebers that one --->, and a host of other things that individually are small, but collectively cost alot of money).

 

bossco, I have clearly made a statement that you will never believe 'could' happen. At this point, my statement is just as accurate as your statement regarding "a drastic shift in the oil business".

I'm a suspicious, cynical human being whereas you seem to have more faith in governments/policies, corporations and the free economy.

 

Define reasonable? Both companies make a similar amount of revenue, yet Exxon makes about 4 times the profit of Wal-Mart.

http://money.cnn.com/magazines/fortu...008/full_list/

Numbers below are rounded. See url and do some clicking for exact figures. Years are based on the Fortune 500 years.

Wal-Mart:
2006 Revenue: $316 Billion, Profit: $11 Billion.
2007 Revenue: $351 Billion, Profit: $11 Billion.
2008 Revenue: $379 Billion, Profit: $13 Billion.

Exxon:
2006 Revenue: $340 Billion, Profit: $36 Billion.
2007 Revenue: $347 Billion, Profit: $39,500 Billion.
2008 Revenue: $373 Billion, Profit: $41 Billion.

 

Well, I think that oil companies are entitled to make a fair profit- Typically, now, they are "energy" companies, not just oil companies- many are diversifying into geothermal, solar, whatever form of energy that will be sold in the future. And, automobile use is literally a drop in the bucket, compared to the oil burnt to generate electrical power, keep out fleet of aircraft flying, power the diesel trains and trucks and cargo ships around the world-

But isn't this off-topic? Ford making $100 million in a quarter is just proof that they are doing a decent job. They still make V-8 powered RWD cars, something that GM has belatedly "re-discovered" in a half-hearted attempt to lure back auto enthusiasts. GM walked away from police and fleet sales over a decade ago, giving that market to the Crown Vic, a decent car, not quite as good as the Caprice was, but YOU CAN STILL BUY THEM- Just like the Mustang- No Camaro since '02, but the Mustang never went away.

When I start seeing FWD cars running Nascar, or Indy, or LeMans, MAYBE I will consider driving one. When Mercedes, or Porsche, or Alfa, Ferrari, et. al, start building FWD 'performance' vehicles, just maybe I will pay attention. But GM quit building cars I lust for years ago, and, as much as I have always been a GM person, as were my dad and uncle before me, most likely my next car will be a blue oval product. Sorry- I loved the LT1, the LS1, the drivetrains that GM can build- I own a '01 Camaro, and a Chevy truck, but there isn't a car, other than the a couple of the Pontiacs right now that I would even look twice at-

So, way to go, Ford- Keep making money, and maybe GM will figure out how to copy you once again-

 

Heh, I thought Walmart was pulling in a better profit than that - got me there, but if pulling a 10% or a bit more profit is a crime, then here are some more swindlers that need to be regulated.

JP Morgan & Chase
Bank of America
Goldman Sachs
AT&T
Proctor & Gamble
Microsoft (at 27%)
PepsiCo
Allstate
Walt Disney
Prudential Financial
American Express
Cissco Systems
Coca Cola (but not CC Enterprises)
News Corp
Merck
Apple
McDonalds
Raytheon
Wyeth
US Bank Corp
3M
Freeport-McMoRan-Copper & Gold
AFLAC
Halliburton
Colgate Palmolive
Texas Instruments
Qwest Communications

and so on.

 

I didn't say 10% or more profit is a crime I just pointed out that the profit wasn't relative when comparing Exxon and Wal-Mart...

 

I am not saying that 10% is a problem, but when you look at the steep climb in revenue, I think that is what people are getting annoyed with.

http://en.wikipedia.org/wiki/Exxon_Mobil#Financial_data

Profit Margin
2002 5.6%
2003 9.1%
2004 8.7%
2005 10.1%
2006 10.4%
2007 10.0%

Since 2005, it has been at or over 10%. In 2002, it was less than 6%. That is only part of the story. Income has increased by over 10% a year.

2002 Profits were 11.4 Billion. 2007 Profits were 40.4 Billion. I think is really what is pissing people off about oil companies.

 

You don't have a corner on the anti-tax market, so don't take the entire hit.

I agree that our tax system is crap. Starting with something as simple as our system of sales taxes which isn't included with advertized prices all the way up to our complex income and corperate tax system. Unlike most other countries, you are not only reminded everywhere you turn that you're paying taxes, but it's entirely too complicated and has too many loopholes.

However, when someone complains about ALL taxes being bad, or that our taxes are too high, and drags out a few obscure questionable government grants of a few million dollars when the entire Federal budget is well over a Trillion Dollars, I feel a need to put things into perspective because in the grand scheme of things, it almost comes across as silly.



The example you use "tapping into miracle energy sources like the aurora borealis" dates back to 2003. In short, the earth's magnetic fields transmits waves up to 25 million mph. Auroras happen when these waves are passed by electrons hitting the atmosphere, and in fact, Auroras are an actual energy source, since the creation of an Aurora itself is a release of energy resulting from a reaction of electrons and the earth's magnetism.

The government sent about $5 million out of a budget that was over$2,500,000,000,000 that year, not including money spent in Iraq.

To put the amount spent studying the Aurora as an energy source in perspective, Exxon earned 39.5 billion dollars in pure, after taxes profit in 2007.

The entire amount studying the Aurora Borealis as an energy source totalled roughly what Exxon made in an hour and a half in 2007.

From the standpoint of government spending, it equaled something like a minute and a half of an entire year of US government spending.


Rhetoric and snappy government waste stories tend to melt quickly when put into context of the entire story.

 

Certainly there are, have been, and will continue to be companies that will try to establish themselves as a monopoly - it's a desireable position to be in. But that doesn't make it right. I personally think it's the capital investment required, and the governmental regulation of mining and drilling that keep start-up capitalists out of this industry and keep the competition minimal.

I'd draw one little difference between the software guys, the carmakers of the 70's and oil today...
As for the software... nobody got fired for not being able to come to work, or froze to death because "their computer didn't boot up". We could live without computers and software back then, and there actually was competition (aggressive too between MS and Novell and Sun).

As for the carmakers... there are yards, junkyards, car lots, and newspapers full of old car for sale - cheap too. One could easily put themselves into a 10-year old car back then and keep it on the road with maintenance and parts. It's not like you absolutely HAD to buy a new car every year or two.

Point - we had alternatives.

For the oil/gas issue... WE MUST HAVE IT TO SURVIVE - both literally and economically. Heating oils are used to heat homes as well as furnaces for industry. Gas and diesel literally move our world (in the USA). We can't buy 10-year-old gas and reuse it. We can't buy an alternative fuel for the car in our driveway today (like the software). In short, we are hostages to our own economy and lifestyle, and we MUST have the fuel to keep our cogs turning here in the US.

I am the first to admit that we have a huge problem. 9 decades of urban sprawl and the development of our infrastructure based on cheap fuels and the ability to drive when and where we want without concern has led us to a dependency on our vehicles that no other nation has. Europe was mostly developed before the industrial age and certainly before the popularity of cars, so most European cities are centralized - you can walk to the stores, malls, restaurants, etc from your house. And the streets are made to accomodate bicycles, walking, and other modes of transport besides cars. Even more prevailent in China which predates Europe for centralized homesteading, as much of the terrain that they settled is inaccessible to vehicles even to this day, so the walk or ride horses/mules extensively. And of course their poverty level has prevented the vast majority from buying cars so the ride mopeds, bicycles, and such extensively where there are roads to use. We - America - are the most vehicle-friendly nation I have ever been in, and I have circumnavigated the globe many times.

Yup... here... well... we're screwed. One thing I can promise you... the better solution is for us to find a way to move ourselves cheaper, rather than rebuild all of America using a "centralized" plan. There's no way we will relocate all the families that commute, redo all the distribution centers for Mickey-Dees and Wally-World, build markets and restaurants within walking distance of every workplace and home, etc. Our roads are built and they take us to homes and businesses that are there to stay FTMP. In big cities like NYC and CHI, there are alternatives like buses and subways, but in rural North Carolina - that will never happen. Hence, we need to fund the research and get an alternative (or four) rolling ASAP - while there is still an economy worth saving.

All I want is for the right parties to do their fair share of the research... it's in ALL our best interests to keep America churning as best we can.

 

Very intresting and informative post.

Yet, this is considered an operating expense and therefore accounted for. Any profit they make is after this and other expenses are taken out. Also, they wouldn't be doing this if they couldn't recoup their investment due to the price of oil being high enough.

Not that you did it (which I don't believe you did) but people have a tendency to throw costs like this around in a bizzare attempt to explain away and to defend these obscenely high profits. I feel this shows IMHO utter stupidity on the oil company defender's part because those costs are already included in operating costs as can easily be accessed in online annual reports.

Profits are just that.... Profits... as in AFTER all expenses and taxes.

Some people simply don't understand that part.

 

Both of you can count me in on this bandwagon too.
If you are stinking wealthy, you can afford to partake in some of the tax shelters that are there for the elite. If you earn "nothing", you don't have to pay "nothing" (and I have no problem with that per-se). But if you are a hard-working middle class stiff... well, you get the load. Make too much to be exempt, but not enough to go find $500k off-shore investements and utilize foreign operating accounts to hide your "growth" from Uncle Sam.

I also agree that the government spends unwisely quite often.
But at least the governments goofy spending is spread across the masses and most industries get a boost from it. That's a tiny bit of sugar on a huge sour apple though.

I would love to see a reform in tax policy, but at this point I simply want to be able to estimate what my personal fuel bill will be next month so I can budget the rest of my life around it. Tax reform can wait a few months.

 

Funny how people use percentages to distort some basic facts. Percentages are irrelevant here people!!!

Today, Exxon is making $40 billion profit/year. That’s more money than most countries’ GDP.

Tomorrow, Exxon will make $80 billion profit/year on the back of increased oil prices. But where do they stash their money to make their percentages look ‘reasonable’.

Maybe bossco has the answer there?

 

Fine, thanks for that info. But a $1m/day is a drop in the bucket to $40b/year in relative terms.