Gut Rumbles
 

April 27, 2006

quote of the day

"The five year average that oil companies make per gallon of gas is around 6 cents. With the surge in prices over the last year, they are now making about 9 cents per gallon. Government takes about 45.9 cents per gallon. The federal government alone takes 18.4 cents per gallon. So you claim you are being gouged, you are right. You are being gouged, but not by the oil companies, by the government."--- glen dean

Of course, it's GOVERNMENT investigating the oil companies for "price gouging." My aching ass. I guess it takes a gouger to know a gouger. We also have the spectacle of that blithering fucknozzle Arlen Specter bleating about taxing "windfall profits" and even President Bush advocating suspending tax breaks for Big Oil companies.

Sheer brilliance!!! Gas prices are too high, so the way to reduce prices is to RAISE TAXES on oil companies. You can't argue with that kind of logic. You can call it completely hare-brained, but you can't argue with it. It's too stupid.

You can't argue with this, either:

There's been unconscionable behavior all right, most of it on Capitol Hill. A decent portion of the latest run-up in gas prices -- and the entire cause of recent spot shortages -- is the direct result of the energy bill Congress passed last summer. That self-serving legislation handed Congress's friends in the ethanol lobby a mandate that forces drivers to use 7.5 billion gallons annually of that oxygenate by 2012. At the same time, Congress refused to provide liability protection to the makers of MTBE, a rival oxygenate getting hit with lawsuits. So MTBE makers are leaving the market in a rush, while overstretched ethanol producers (despite their promises) are in no way equipped to compensate for the loss of MTBE in the fuel supply. Ethanol is also difficult to ship and store outside of the Midwest, which is causing supply headaches and spot gas shortages along the East Coast and Texas.

These columns warned Republicans this would happen. As recently as last year, ethanol was selling for $1.45 a gallon. By December it had reached $2 and is now going for $2.77. So refiners are now having to buy both oil and ethanol at sky-high prices. In short, the only market manipulation has been by politicians.--- The Wall Street Journal

And a fine job they've done of it, too. After demonstrating their ability to fuck up the market with short-sighted meddling, what do the politicians want to do now to fix it? Why, they want to MEDDLE SOME MORE, of course.

BOHICA. Bend over, here it comes again.

The fact is, we DO NOT have an oil-price crisis on our hands. Even at $3.00 a gallon, gasoline actually is less expensive now than it was under Jimmah Carter's reign. What we've got is unnecessarily high gas prices because of government taxation, pork legislation (ethanol), excessive (and EXPENSIVE) environmental regulation, green-headed fuckwittery over exploiting our own oil reserves, inadequate refining capacity (due largely to excessive environmental regulation--- see BACT standards), a war in Iraq and government demagogery over a problem that government created and exacerbated.

The President and congress are doing what politicians always do in such a situation--- they are relying on the pure ignorance of The American People to shift the blame from themselves to somebody else: EEEEEEvil Oil Companies! That plan will work, too, because The American People are really fucking ignorant. They'll believe that shit.

Of course, they're ignorant enough to believe that global warming is a crisis, too. Don't tell me that demagogery doesn't work.

Aw... pardon me. I'm in a really cynical mood today.

Comments

The mental retards in congress are screaming for the oil companies to lower the price of gas. If they cut their profit in half that would lower the price a whopping 4.5 cents a gallon. The other result would be a sell off on the stock market since the investors would make next to nothing on their money. People had better be scared, very scared of congressional action and investigations. I was around in the 70's when Dimmy Carter actually did what the dummies are wanting to do again. I guess rationing and lines are in the future, all compliments of the congressional idiots. Drunken Ted Kennedy, Schumer, KKK Byrd, Dusty Harry Reid, Turbin Durgin, Bagdad Jim and the other left wing nuts are more dangerous than all of the terrorists in the world combined.

Posted by: Scrapiron on April 27, 2006 08:37 PM

Let's not forget that with the Ethanol blend, you will get less gas mileage and that means more usage.

Posted by: Kim on April 27, 2006 10:52 PM

You're spot on, Acidman. If there's a way to fuck something up, government will find it. And guess what? They'll use their own incompetence as justification for more regulation. I think cynicism can be fairly equated with reality in this case.

By the way, thanks for the Acidbath earlier today.

Posted by: JS on April 27, 2006 10:55 PM

True, adjusted for inflation gas is cheaper now than 20 years ago. But at the same time if you look at the what people are earning now compared to 20 years ago it ain't even close compared to the rate of inflation.

For example; in 1970 you could buy about 4 gallons of gas for an hours work at minimum wage. Now, at minimum wage you can only buy just over a gallon.

All that being said, the biggest contributer to high gas prices is the fact that we don't have the refinging capacity to meet demand. There's more crude available than what we have refining capacity for. Why is that? Because the fucking Democrat backed enviro-nazis have put the breaks on building more refineries.

I see Chuck Schumer advocating yet more taxes on oil companies out of compassion for the consumer. Blow me, Chuck. If you really cared you'd drop the Fed tax on gas and promote tapping into Anwar AND building more refineries instead of trying to generate yet more fucking money for the guvment.

Posted by: Daniel Medley on April 28, 2006 06:10 AM

Well I will give big oil this, they have managed to blow smoke up everyones ass so far that they actually have people believing their bullshit stories. No new refineries, true, because of the envior -nazi's, bullshit nice tryi. The truth is big oil doesn't want to build anymore capacity and the hugg a tree bunch is a handy excuse. If half ass home building companies can build a housing development in a fucking swamp, don't tell big oil can't bribe the same crooks to get the permits. I don't think profit is a dirty word, scamming the public and consumbers is. Oil and gas are not luxury items, they are the key driving factor behind economic growth.

Posted by: jamesoldguy on April 28, 2006 07:23 AM

it's easy, invest in oil companies and walk or ride a bike whenever you can.

the world is full of lazy fucks that drive 3 tons of steel to the corner store instead of walking and are raising a generation of fat lazy kids that have to be driven everywhere instead of walking or riding their bikes. when i was a kid, we rode our bikes everywhere.

Posted by: leo on April 28, 2006 08:05 AM

"Fuckwittery" - my, you ARE the wordmaster - I will never forget this word!!! Another great post!

Posted by: Anastasia on April 28, 2006 09:02 AM

Jamesolddude-
Why don't you look up the experiences of a company called Arizona Clean Fuels who wants to build a refinery out in the middle of nowhere in Arizona. That's why there isn't any new refineries being built. 12 years and STILL they haven't even been able to break ground.

Posted by: toddk on April 28, 2006 01:45 PM

You? Cynical? I'll never believe it. I secretly believe you're the stay-puft marshmallow man underneath that crusty exterior.

Posted by: trouble on April 28, 2006 01:56 PM

Drill ANWAR, fuck the caribou... I hear they are good for jerky.

www.gasbuddy.com to find a station with less sand in the lube when it comes to the price.

Fuckwittery is brilliance wrapped into the spoken word.

Posted by: Cythen on April 28, 2006 02:40 PM

I wrote the following quite a while ago, but I keep it around because it always applies when politicans try to DO SOMETHING.

Here is what a Mech. Engineering degree does for you.
1. You get the scientific method beat into your brain.
2. You learn to use it to solve real problems.

And, then you spend the rest of your life watching and listening
to people make emotional decisions
and fuck things up.

Posted by: Dan Pursel on April 28, 2006 06:27 PM

Toddk, you need to be a bit more careful with geography. {:^)

"Jamesolddude-
Why don't you look up the experiences of a company called Arizona Clean Fuels who wants to build a refinery out in the middle of nowhere in Arizona. That's why there isn't any new refineries being built. 12 years and STILL they haven't even been able to break ground."

I live 25 miles north of the courthouse square in Prescott, AZ. From the courthouse, take AZ 89 (White Spar Road) approximately 15 miles down the mountain to Nowhere, AZ. People who stop at the Burro Bar think the sign on the front is a joke, because the second line is "Nowhere, AZ". It is not a joke. And the bartenders (two of them cover the week) know me, because the mountain road is a great run in my Corvette. The Burro Bar, and the little trailer (trash) park for desert rats behind it are the only domiciles in Nowhere. {:^)

But, it is not where Clean Fuels proposes to build. Because, getting crude there in the first place, and then piping or trucking all that gasoline up or down the mountain from "Nowhere" to what passes for civilization in Arizona would be an absolute engineering bitch.

Posted by: Dan Pursel on April 28, 2006 06:47 PM

Great post AND comments, but I see nothing in here about oil logistics.

When a Greek shipping baron can load 50 million barrels of oil at Khargh Island, paying $1.50/gallon for it, then steam towards the US, getting there 3 weeks later and offload that oil for $1.78, he has just made Gross profit of $14 million on his shipload of oil. If you subtract the cost of getting the oil across the oceans, he probably gets to keep $12 million.

And we haven't even refined a drop of it.

What I'm getting at is the way oil, as a commodity, is priced.

Burlington Northern Railway doesn't get to load up a train full of wheat at $6.00/bushel in North Dakota and ship it to Seattle to put on a ship for China, getting the Chinese to pay $7.00/bushel for the wheat at dockside. The railway gets a small per-bushel fee for shipping the wheat to the docks.

Why should oil be any different?

If the US had a fleet of our own tankers, we could iron out the volatility in the oil price market instantly, because this 'spot-price on delivery" system would be replaced by actual contracts for delivery that would be carried out, not just traded as if they were going to be.

But, we don't own many ships, because we have no one who wants to pay for the cost of building and upkeep, and Philipino seamen work for half the wages of US seamen and Greek captains are also a dime a dozen. End result is that we are at the mercy of the oil shipping barons, about 5 guys in Greece who own and/or control almost all of the supertankers.

If Congress wants to tinker with anything, why don't they prohibit any oil ship from discharging cargo except that cargo bought on a contract of at least 60 days ACTUAL duration? If the shipping barons can't sell the oil at the prices of the inflated spot market, they will sell it on the less-inflated contract market, because a ship full of oil that they CAN'T SELL is money wasted to them.

The entire commodities market is an un-necessary boil on the body economic. It exists ONLY to line the pockets of middlemen, not producers or consumers of commodity products.

If you think that the oil business is flaky now, just wait until Exxon-Mobil-ADM starts to get THEIR hooks into us for the coming E85 and biodiesel products.

There's little wrong with the production of energy in this world. The problems are ONLY in the marketing end, and all "fixes" should look to the marketing end first.

Remember Enron? And their phony electricity "shortage" that they foisted off on CA?

It's going to happen again, but not in volts, in gallons of gas.

Posted by: Rivrdog on April 28, 2006 07:53 PM

It takes 11/2 gallons of gas to produce 1 gallon of ethanol. Do the math!!

Posted by: Alan on April 29, 2006 01:46 AM

Dan Pursel-

: )

That sounds like the kind of NIMBYism I can support...keep it away from your favorite watering holes.

Posted by: Toddk on April 29, 2006 12:06 PM

I think the math is off a bit when you say 9 cents a gallon is what the oil companies make. What the large integrated oil companies fail to say is this 9 cents is the profit for their gasoline operations only. Since many of them produce the oil they refine they also make a shitload of money on the raw commodity. Often upwards of $40.00 US pure profit per barrel. That's nearly another $1.00 gallon profit. You have to read the fine print on that study commissioned by the Oil industry to get the truth of the matter. Luckily we have Rick Santorum trying to get a bill through to give every person a $100.00 gas rebate. Gee I wonder where that money will come from? Fuckwittery indeedy.

Posted by: kk on April 30, 2006 01:06 AM

From Daniel (near the top):

---------------------------------------------------------
True, adjusted for inflation gas is cheaper now than 20 years ago. But at the same time if you look at the what people are earning now compared to 20 years ago it ain't even close compared to the rate of inflation.

For example; in 1970 you could buy about 4 gallons of gas for an hours work at minimum wage. Now, at minimum wage you can only buy just over a gallon.
---------------------------------------------------------
Try comparing it to the late 70's, as that was a peak in real dollars (greater than today). The regular 87-Octane was $1.30 or $1.40 per gallon at the pump. Min. wage was aroun $2.00 or $2.50. So, yeah, you could get a gallon and a half for an hours worth (after taxes on your wages and the gas).

It's about the same right now, but the good thing is, I'm making the big bucks right now, so I am totally unconcerned the the problems of a few fuckwits. ;-} Plus, I just saved 15% on my auto insurance! But, I had drive my 8 mpg SUV forty miles through the snow to get to the insurance office, where I only spent about 5 minutes talking to the gay lizard - sounded vaguely British, a very proper chap. Oh, he was a Gekko, not a lizard - my bad.

Posted by: Jimmy Antley on May 1, 2006 05:25 PM
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