OT: Gas Prices

[Azselendor]

Pheonix, distance is not a factor in oil prices. If I remember right, Europe is getting much of thier oil out of former soviet bloc countries and I wouldn't be surprised there is some bad blood there.

Wasn't there a thing in the news a few months ago with Russia and Ukraine squabbling over oil access and that was threatening to raise oil prices in europe as a whole?

[Phoenix-D]

No, it isn't. It is a factor in how much gas prices hurt, though.

[Renegade 13]

Rollo said:
Just for reference, gas currently costs about $6.00 per gallon where I live.

What is your complaint about US gas prices exactly?

I too am not sure what American's are complaining about. Currently, where I live, we're paying approx. $1.15/liter!. Taking into account the difference between Canadian and American dollars and converting liters to gallons, we in Canada are paying the equivalent of $3.83/gallon!

According to Will, you're only paying about $2.75 per gallon. We're paying over a dollar more per gallon than you are, and up here in Canada the average distance a person has to travel per year is much farther than the average American...the country is larger and less populous, equalling greater travel distances, on average. Not to mention rural people like me, who have much much farther distances to travel of average...

I'd say you have it pretty easy.

[Will]

Caduceus said:
Yet the head of Exxon just retired with a multi-million dollar severance package.

Read it here .

While it seems outrageous to us "common people", multi-million dollar severance packages, and even multi-million dollar salaries, are par for the course in Corporate USA. Top executives are valuable to companies based on business experience and connections with other top executives; the salaries remain so high because if the companies don't pay the outrageous sums, the executives go to other companies that WILL pay. Similarly, severance packages are high amounts because it is very bad business to burn bridges. The person leaving the company will still have lots of contacts throughout the corporate world, and can influence those contacts. It's best to spend what amounts to pocket change (for the corporation) to the departing executive, to keep them happy and to have them not complaining loudly to everyone s/he knows about the company.

Not saying I think it's a good thing, just saying it's not limited to oil companies, and there is an economic reason for it.

[Caduceus]

"What about our stockholders, Bob? Who's looking out for them?"

- From "The Incredibles"

[Atrocities]

Rollo said:
Just for reference, gas currently costs about $6.00 per gallon where I live.

What is your complaint about US gas prices exactly?

We so not live where you live. And your cost per gallon of gas is mostly tax and not Oil Company Greed.

[PDF]

Atrocities said:

We so not live where you live. And your cost per gallon of gas is mostly tax and not Oil Company Greed.

I live near Rollo it seems..
As for USA maybe you shouldn't have Oil Company executives as Government heads ?

[Atrocities]

Well said.

[shinigami]

Are the oil companies sticking it to us? Sure they are.

Should the government do something about it? No, its called free enterprise. You have the option to not pay that outrageous price for gas. Of course, if you exercise that choice then you may also be choosing to not work and by extension, not eat, but you do have that choice.

Seriously, I don't feel that it is the government's place to step in and do something about high prices. History has shown that whenever the price of a product goes higher than the market will bear people will start to find alternatives.

Now, having said all that, I do believe that the oil lobby uses our government to squash any alternatives that come along. My solution, ban all lobbying of Congress.

[Jack Simth]

The anti-trust laws were made for a reason.

When a company successfully kills all large competitors, especially in a fairly necessary industry (fuel, building materials, food, et cetera), it can do things that can't be done otherwise.

A small company underselling you? No problem; they're still small, with a limited distribution area. Sell at a loss in that area until your opponent goes under, then raise prices back up to wherever you feel like it. Revenues from elsewhere will cover the shortfall, which will be fairly short-term, and in return, you maintain an effective monopoly.

Getting tired of doing the above every three years? Have a chat with all your suppliers / business customers, and arrange for exclusive contracts. They don't sell to / buy from anyone else. Your currently small competition can't sell to your customers and can't buy supplies. Shortly thereafter, they go under - no reaction required.

Want to be un-boycottable? No problem. Either of the above pretty much eliminates all competition; they don't buy from you, they go without. Try making a skyscraper without steel or concrete. Workers striking? Pity most of their skills aren't useful anywhere else. They're stuck with whatever wages you say. Quality sucks? Long as you can avoid lawsuits over the quality of your materials (e.g., it's not up to the specs you said it was, causing the bridge to fall - simple fix, if you're the only business; get it in writing that they won't hold you accountable for such things), they can't do a thing about it, as there's nowhere else to turn.

And of course, once you've integrated horizontally (all of that stage of the business - refining ore into steel, say) you can integrate vertically quite easily (for the previous example, that would be mining the ore, fabricating the beams, et cetera) and eliminate competition at other layers simply by not buying from them / selling to them at much higher prices.

THESE HAPPENED. That's why there's laws that supposedly stop such tactics in place in the US. They don't always seem to be enforced (RIAA and TicketMaster come to mind), but they're in place. Slight trouble with Big Oil, though, it's international. Federal law can't control what they do on the other side of the pond, and having the UN take such steps would be ... too scary.