Fuel prices

[PoTreeBoy]

I helped build additions to that refinery in 1967-68 as an IBEW apprentice.
However, if you read Lyondells’ report to stockholders you’ll get a completely DIFFERENT picture of their business…having made only $1.7 Billion in profits last QTR.

LyondellBasell Reports Third Quarter 2022 Earnings

www.lyondellbasell.com

Their “plans” to shutter that refinery are not because they are losing money there. It’s because they anticipate a huge profit on its’ SALE.

I worked for ARCO/Lyondell on the chemical side from '74 to '95. As ARCO reduced its mid-continent exposure to emphasize west (mostly)- and east (lesser)-coast business, the Houston refinery became a step-child, dependent on external crude supply. Independent oil refining profits are a boom or bust roller coaster ride. If you produce, refine, and retail you get the profit regardless of which sector is high or low at the time. But if you don't produce or retail (which LB doesn't), you ride the roller coaster. Stockholders want smooth, steady income.

LyondellBasell has made a big bunch of money from that refinery over the last couple of years, but I think they see the next bust coming as a good time to shut her down since their efforts to get their sales price failed.

 

[Biker1mike]

Everyone makes it sound like profits are immoral. If it weren't for business, we all would be farmers growing our own food, and society as we presently know it wouldn't exist. All the liberals that I know are anti business, but they have huge holdings in the stock market in their 401K pension plans.

Just a reminder. Not all democrats are far left liberals just as not all republicans are far right conservatives.
I am a fiscally responsible democrat.

 

[jyoutz]

Today’s lowest prices near me.

 

[AndyM]

What are you drinking..?? Oil Company profits are the highest EVER! ….and continue to rise as Americans suffer high prices! Do a little RESEARCH!

”Exxon alone reported a profit of $17.9 billion – the highest quarterly profit reported by any oil company in history – while Chevron reported $11.6 billion, Shell reported $11.47 billion, and BP reported $8.45 billion

A little perspective - two years ago many Oil cos were failing. One of Canada's biggest, largely quit Canada and rebranded in the US (Encana became Ovintive).

If profit is the problem, perhaps Apple should reduce the price of it's products (not that I use them).

Exxon's record-smashing Q3 profit nearly matches Apple's

Exxon Mobil Corp on Friday smashed expectations as soaring energy prices fuelled a record-breaking quarterly profit, nearly matching that of tech giant Apple, the largest U.S. company by market value....

www.marketscreener.com

No profit means no Oil cos and, as there is no viable, available alternative to oil, if you kill the local companies you become dependent on some folks that you might not like to deal with.

 

[jyoutz]

A little perspective - two years ago many Oil cos were failing. One of Canada's biggest, largely quit Canada and rebranded in the US (Encana became Ovintive).

If profit is the problem, perhaps Apple should reduce the price of it's products (not that I use them).

Exxon's record-smashing Q3 profit nearly matches Apple's

Exxon Mobil Corp on Friday smashed expectations as soaring energy prices fuelled a record-breaking quarterly profit, nearly matching that of tech giant Apple, the largest U.S. company by market value....

www.marketscreener.com

No profit means no Oil cos and, as there is no viable, available alternative to oil, if you kill the local companies you become dependent on some folks that you might not like to deal with.

I remember in economics class that 15-20% profit was considered the standard and acceptable profit model. This 100%+ profit indicates that something is wrong with the free market system.

 

[jimh406]

Everyone makes it sound like profits are immoral.

Not everyone ... only those who don't understand how businesses work.

 

[lynnmor]

Not everyone ... only those who don't understand how businesses work.

And of course the perpetual victims.

 

[DustyRusty]

For 48 years in business, every year we made a profit, paid the employees well, and were able to afford rising healthcare premiums. Last year due to the higher cost of energy, deliveries, heating, etc. we lost money for the very first time. We were forced to either raise the cost of the goods sold or go out of business. We raised the cost of the products and the customers understood that items would be more expensive, and they stayed loyal to us. This year we are on track to keeping our heads above water, but if this winter heating costs bite us hard, then we will have to figure out what to do. It is our 50th-year anniversary.

 

[Flintknapper]

For 48 years in business, every year we made a profit, paid the employees well, and were able to afford rising healthcare premiums. Last year due to the higher cost of energy, deliveries, heating, etc. we lost money for the very first time. We were forced to either raise the cost of the goods sold or go out of business. We raised the cost of the products and the customers understood that items would be more expensive, and they stayed loyal to us. This year we are on track to keeping our heads above water, but if this winter heating costs bite us hard, then we will have to figure out what to do. It is our 50th-year anniversary.

Good job Sir....! Much respect.

 

[BigG]

These oil companies are making great profits because their is little to no reinvestment into themselves. Few complained with the advent of the green new deal thinking that there would be little change to our way of life. However Joe and his minions have caused damaging changes around the world to occur much quicker then we thought posable. A very large change is the ability for the oil companies to drill and refine the oil. So if the oil company is not exploring, drilling, building pipelines and building refineries which cost millions if not billions of dollars then all of a sudden the bottom line looks very very good.

If and when all this solar power and wind power starts to fall behind the demand then the same oil companies will be running on a thinner margin. Their profits will be very slim as they try to rebuild.

I am all for cleaner energy but until it is found we can not shut down the entire worlds economy. For some reason Joe has failed to see the foolishness of this actions.

 

[The Evil Twin]

No… you were specifically talking about “teetering on the edge”…as if oil companies are somehow endangered species.
The ACTUAL REASON refiners are slow to construct new refineries is because of environmental and MARKET concerns in economies that are heading toward a REDUCTION in use of fossil fuels. (or at least make that claim.)

You can’t convince me to feel sorry for Big Oil when they make the profits they do from sucking minerals out of public lands and selling them for the profits already shown…while also receiving “depletion allowances” and subsidies.

Uhh...just read the 1st two paragraphs and wrap your head around it. If you can.
I love being the 1534672 people on his iggy list.
Bet ol blowhorn didn't feel bad for bog oil as they suffered losses in the billions over the last decade.

 

[GreensvilleJay]

re:

I remember in economics class that 15-20% profit was considered the standard and acceptable profit model. This 100%+ profit indicates that something is wrong with the free market system.


well you could also say your economics class was wrong....
Doubling your investment is GREAT,heck I've made 700,800, 1000% return on some of my 'investments'. Buy something cheap and sell for lots more ,with zero added costs.

I know someone who closed their store on Saturdays, even though they'd sell $4K of product and after the $2 cost then maybe $500 for labour and overheads,said they didn't need the $1500+- in their pocket EVERY week x50.... prefer to be up at the cottage or elsewhere.

In a TRUE 'free market' system the seller can CHOOSE what price ,to whom, whenever. we do NOT have that.
Examples. Ford in Oakville build vehicles, ships to USA, sells them CHEAPER than here in Oakville...
OKI make shingles down east, ships to NY state...CHEAPER to buy there than here
I should be able to buy products locally made for LESS than others can buy 1,000s of miles away just based on shipping costs alone.

 

[DustyRusty]

re:

I remember in economics class that 15-20% profit was considered the standard and acceptable profit model. This 100%+ profit indicates that something is wrong with the free market system.


well you could also say your economics class was wrong....
Doubling your investment is GREAT,heck I've made 700,800, 1000% return on some of my 'investments'. Buy something cheap and sell for lots more ,with zero added costs.

I know someone who closed their store on Saturdays, even though they'd sell $4K of product and after the $2 cost then maybe $500 for labour and overheads,said they didn't need the $1500+- in their pocket EVERY week x50.... prefer to be up at the cottage or elsewhere.

In a TRUE 'free market' system the seller can CHOOSE what price ,to whom, whenever. we do NOT have that.
Examples. Ford in Oakville build vehicles, ships to USA, sells them CHEAPER than here in Oakville...
OKI make shingles down east, ships to NY state...CHEAPER to buy there than here
I should be able to buy products locally made for LESS than others can buy 1,000s of miles away just based on shipping costs alone.

You should, but you can't because Canada adds a lot of taxes to the cost of the product when it is sold in Canada, which aren't added when they are sold in the US. It is called Socialized Medicine, and someone has to pay for all the care that the government gives to everyone. They get it from everything that you buy in Canada from a package of gum to the largest tractor that you can imagine.

 

[jyoutz]

re:

I remember in economics class that 15-20% profit was considered the standard and acceptable profit model. This 100%+ profit indicates that something is wrong with the free market system.


well you could also say your economics class was wrong....
Doubling your investment is GREAT,heck I've made 700,800, 1000% return on some of my 'investments'. Buy something cheap and sell for lots more ,with zero added costs.

I know someone who closed their store on Saturdays, even though they'd sell $4K of product and after the $2 cost then maybe $500 for labour and overheads,said they didn't need the $1500+- in their pocket EVERY week x50.... prefer to be up at the cottage or elsewhere.

In a TRUE 'free market' system the seller can CHOOSE what price ,to whom, whenever. we do NOT have that.
Examples. Ford in Oakville build vehicles, ships to USA, sells them CHEAPER than here in Oakville...
OKI make shingles down east, ships to NY state...CHEAPER to buy there than here
I should be able to buy products locally made for LESS than others can buy 1,000s of miles away just based on shipping costs alone.

I wasn’t talking about investments, just the year over year profits of most industries. Most run on small margins in a free and competitive system. 100% annual profits tends to indicate that there is no competitive market or collusion happening.

 

[Flintknapper]

I wasn’t talking about investments, just the year over year profits of most industries. Most run on small margins in a free and competitive system. 100% annual profits tends to indicate that there is no competitive market or collusion happening.

Crude oil is a global commodity, the market competition is built in.

"If you took Economics 101 in high school or college, you learned that selling prices for goods and services are determined by “what the market will bear.” That means that consumers – the market – decide what a product is worth, and will give so much money, but no more, for that product."

 

[D2Cat]

Crude oil is a global commodity, the market competition is built in.

"If you took Economics 101 in high school or college, you learned that selling prices for goods and services are determined by “what the market will bear.” That means that consumers – the market – decide what a product is worth, and will give so much money, but no more, for that product."

Kind of like a farm auction!!

 

[Flintknapper]

Kind of like a farm auction!!

SOLD......!

 

[jyoutz]

Crude oil is a global commodity, the market competition is built in.

"If you took Economics 101 in high school or college, you learned that selling prices for goods and services are determined by “what the market will bear.” That means that consumers – the market – decide what a product is worth, and will give so much money, but no more, for that product."

Obviously. But when corporations are making 100%+ profits for a yearly return and every company in that industry is doing the same, you have collusion, not a free market. Particularly when consumers have minimal alternatives.

 

[Flintknapper]

Obviously. But when corporations are making 100%+ profits for a yearly return and every company in that industry is doing the same, you have collusion, not a free market. Particularly when consumers have minimal alternatives.

Really....? Collusion!


col·lu·sion
/kəˈlo͞oZHən/

noun

1. secret or illegal cooperation or conspiracy, especially in order to cheat or deceive others.
   
   
   So the Oil Industry (worldwide in structure), all got together and quite apart from any free market principles decided to 'Price Gouge' (as you seem to think)? Is that pretty much it?

I sense that you must not like Capitalism with its basic premises of 'Laissez-Faire' (meaning Leave Alone). So the government does not interfere or dictate profit margins.

Nor...the tenets of a Free Market which lets the Market Decide with respect to Supply and Demand.

All of these things subject to influences, ebbs and flows. No question about that.

I believe we are seeing industry 'consensus' not collusion. And no....that is not just semantics. \

You want to see fuel prices come down, stabilize and remain so, then make it easier for Oil Companies to do their business, produce, refine and distribute their products and take every measure to control inflation which is the real elephant in the room. You can't print and dump trillions of dollars into the economy and not think it won't cause inflation.

 

[GreensvilleJay]

yes...
just look at gas stations near you...
bet they're all the same price or within a penny or two even though they buy their product from different suppliers, different volumes, and what 'services' the gas station offers....

I have 7 stations nearby , all are priced within 2 cents.