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I suppose driving up the cost of everything to where the average consumer can only affort Malt-o-meal instead of Cheerios might be a good thing to some, but I don't think so.

 

 

how about driving up the relative cost of buying something that comes from far away compared to buying local products? that sounds pretty positive to me.

Edited by mustang_sallad
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how about driving up the relative cost of buying something that comes from far away compared to buying local products? that sounds pretty positive to me.

Given that not all products are made locally, how do you expect that to work?

 

Perhaps you know of a way to recover the "deadweight loss"? (Here's the definition of deadweight loss for you)

http://www.youtube.com/watch?v=zhD--UeRiOI&feature=related

 

Nice neutral source you got there with the ExxonMobil blog.

Do you really think that ExxonMobil registers its domains through GoDaddy.com?

 

Now, if you have contrary information refuting that 2 cents profit per gallon claim, I ask you to provide it.

Edited by RangerM
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Given that not all products are made locally, how do you expect that to work?

 

Perhaps you know of a way to recover the "deadweight loss"? (Here's the definition of deadweight loss for you)

http://www.youtube.com/watch?v=zhD--UeRiOI&feature=related

 

 

Do you really think that ExxonMobil registers its domains through GoDaddy.com?

 

Now, if you have contrary information refuting that 2 cents profit per gallon claim, I ask you to provide it.

 

 

The profit is in the crude oil not the refined gasoline.

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And the price of crude oil is set by the market, not the oil company.

 

And oil companies not increasing processing capacity for years also limits the rare of response to market fluctuations in demand, all of which guarantees that any speculation of supply shortfalls will be amplified.

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The profit is in the crude oil not the refined gasoline.

 

The profit is in finding the oil (something ExxonMobil is very good at). In many case they sell the rights. In other cases they go into a joint venture with another company who will produce the field. Refining is practically a side business. ExxonMobil would still be highly profitable if they sold every single refinery they own.

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And oil companies not increasing processing capacity for years also limits the rare of response to market fluctuations in demand, all of which guarantees that any speculation of supply shortfalls will be amplified.

Limitations in refining capacity have more to do with external forces than any willingness to hold down capacity. For instance, Sunoco is a refining company, not an oil exploration/drilling company. They'd love to increase their capacity, but the cost is often prohibitive.

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Limitations in refining capacity have more to do with external forces than any willingness to hold down capacity. For instance, Sunoco is a refining company, not an oil exploration/drilling company. They'd love to increase their capacity, but the cost is often prohibitive.

Yeah, your probably right on that score too...

 

What's interesting is that Mulally mentioned recently that as gas prices went up through the

$3.25 to $3.50 range people really started focusing again on smaller more fuel efficient vehicles.

 

So no matter what happens with gas prices, vehicle manufacturers will have to be on their game

delivering great fuel economy or at least fuel economy that reflects consumer's desire to reduce

the impact of rising gas prices. maybe that's what's really important, how oil reflects rising costs

in everything we buy, people don't have that much control over food and utilities costs, they can

economize a bit but it's in discretionary spending and weekly fuel bills that people stand to save the most.

 

Not saying that's the best plan , just the way most folks will probably address rising gas prices.

I'm not sure how the interaction with supply demand changes when people spend less, use less

with prices high, whether oil and gas prices start to nose over and it finds a new equilibrium.

Edited by jpd80
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Are there refineries in AK?

Six refineries currently operate in Alaska:

  • Kenai Refinery (Tesoro), Kenai
  • Valdez Refinery (Petro Star), Valdez
  • North Pole Refinery (Petro Star), North Pole
  • Kuparuk Refinery (ConocoPhillips), Kuparuk
  • North Pole Refinery (Flint Hills Resources), North Pole
  • Prudhoe Bay Refinery (BP), Prudhoe Bay

The profit is in finding the oil (something ExxonMobil is very good at). In many case they sell the rights. In other cases they go into a joint venture with another company who will produce the field. Refining is practically a side business. ExxonMobil would still be highly profitable if they sold every single refinery they own.

ExxonMobil not only excels at upstream activities, but even more so at integrating them with its downstream and midstream businesses. XOM has indeed cut back on downstream investment (for instance, in 2008 it made the decision to divest ownership of Exxon and Mobil branded filling stations). However, a Morningstar article put it best: "unlike many of its integrated peers, ExxonMobil has true integration between upstream and downstream operations, as opposed to a collection of assets."

 

Back to the topic of this thread: higher (or at least relatively high in comparison to previous time periods) motor fuel prices would confer benefits to many parties. I particularly like the idea of establishing a price floor on motor fuel, so for instance gasoline or highway diesel fuel would retail for a minimum of 5 USD per gallon. If nothing else, this would be a boon for automakers operating in the United States as it would enable them to better plan development of future products. The U.S. federal government already imposes fuel economy regulations like CAFE; volatility in fuel prices makes it very difficult for the automakers to evaluate whether long term investments in B and C cars, for example, will pay off.

Edited by aneekr
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Six refineries currently operate in Alaska:

  • Kenai Refinery (Tesoro), Kenai
  • Valdez Refinery (Petro Star), Valdez
  • North Pole Refinery (Petro Star), North Pole
  • Kuparuk Refinery (ConocoPhillips), Kuparuk
  • North Pole Refinery (Flint Hills Resources), North Pole
  • Prudhoe Bay Refinery (BP), Prudhoe Bay

Correct me if I'm wrong, but none of those refineries produce gasoline as a finished product.

Edited by RangerM
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ExxonMobil not only excels at upstream activities, but even more so at integrating them with its downstream and midstream businesses. XOM has indeed cut back on downstream investment (for instance, in 2008 it made the decision to divest ownership of Exxon and Mobil branded filling stations). However, a Morningstar article put it best: "unlike many of its integrated peers, ExxonMobil has true integration between upstream and downstream operations, as opposed to a collection of assets."

 

You are correct. However, I can tell you from personal experience, the focus of the company is shifting away from downstream refining.

Edited by TomServo92
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Back to the topic of this thread: higher (or at least relatively high in comparison to previous time periods) motor fuel prices would confer benefits to many parties. I particularly like the idea of establishing a price floor on motor fuel, so for instance gasoline or highway diesel fuel would retail for a minimum of 5 USD per gallon. If nothing else, this would be a boon for automakers operating in the United States as it would enable them to better plan development of future products. The U.S. federal government already imposes fuel economy regulations like CAFE; volatility in fuel prices makes it very difficult for the automakers to evaluate whether long term investments in B and C cars, for example, will pay off.

 

That is just unbelievable. Did you really say that? Are you suggesting that the government artificially make the price higher of fuel higher to support an industry? (and that is insane anyway. Toyota will eat Ford and GM for lunch)

 

I can't believe what some of these people actually think is a good idea. WHAT IS HAPPENING IN THIS COUNTRY??????

 

This is exactly why liberals are dangerous. They try to get you to do what you shouldn't have to do because they think it is a good idea, and to hell with what you think. Forget the law of supply and demand, forget the power of capitalism to lower prices, forget all that.......just do what they want, and if they screw something else up in the process they didn't consider would happen in their grand plan, so what, they feel good.

 

I have no idea what some of you people are thinking, but it is obvious you have no confidence in yourselves, or your companys/corporations. You have somehow been convinced that the the things that made this country great and stand above all others, somehow is faulty.

 

I wonder how many of you are smart enough to realize that all our domestic automakers did splendidly as long as the price of fuel was kept relatively stable. As long as the price did not swing wildly, they could outfit America in the vehicles they wanted most. And yet, your whole thinking is to lock the price of fuel waaaaaaay up there just to have a lock, so you can hope and pray your guys can again control the market, while screwing the rest of your country for what you think could be your gain. And some of you want to talk about the oil companys?!?!?!?!?!?!?!?!?!

 

Anybody with any logical thinking just does not get it. Between Obamas spending and not being able to use natural resources in this country, and good ole GW spending to boot, we are in deep doo......deep doo that can only be solved by adding to the tax base by people paying in by spending money, and working to make it. And what is the solution I am seeing??!!!???!!!!???!!!!! Keep fuel high so more of peoples money goes into their tank......even if they work.........which means they won't spend it domestically, which means no jobs. Brilliant, absolutely brilliant!! Give those dollars to Brazil, The House of Saud, Canada, Venezuela, etc.

 

Well, at least you brilliant liberals aren't prejudice. You give the money to brown people, beige people, and people who wear turbins. Everyone but your own countrymen. Congrats, don't you feel good and special now?

 

Who was it that said------->we will destroy America without ever firing a shot!

 

Guess what fellas, they are succeeding, and they did it by convincing some of you to regurgitate their dogma, and while doing it.....actually believe you are right!!!!!!!!! Geezus H Christ, wake up!!!!!! You have been handed the greatest country/empire the world has have ever seen, and you want to make it look like a cross between Europe and the Soviet Union with a little of Cuba and China mixed in. What are you thinking!!!!!

Edited by Imawhosure
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That is just unbelievable. Did you really say that? Are you suggesting that the government artificially make the price higher of fuel higher to support an industry? (and that is insane anyway. Toyota will eat Ford and GM for lunch)

 

I can't believe what some of these people actually think is a good idea. WHAT IS HAPPENING IN THIS COUNTRY??????

 

This is exactly why liberals are dangerous. They try to get you to do what you shouldn't have to do because they think it is a good idea, and to hell with what you think. Forget the law of supply and demand, forget the power of capitalism to lower prices, forget all that.......just do what they want, and if they screw something else up in the process they didn't consider would happen in their grand plan, so what, they feel good.

 

I have no idea what some of you people are thinking, but it is obvious you have no confidence in yourselves, or your companys/corporations. You have somehow been convinced that the the things that made this country great and stand above all others, somehow is faulty.

 

I wonder how many of you are smart enough to realize that all our domestic automakers did splendidly as long as the price of fuel was kept relatively stable. As long as the price did not swing wildly, they could outfit America in the vehicles they wanted most. And yet, your whole thinking is to lock the price of fuel waaaaaaay up there just to have a lock, so you can hope and pray your guys can again control the market, while screwing the rest of your country for what you think could be your gain. And some of you want to talk about the oil companys?!?!?!?!?!?!?!?!?!

 

Anybody with any logical thinking just does not get it. Between Obamas spending and not being able to use natural resources in this country, and good ole GW spending to boot, we are in deep doo......deep doo that can only be solved by adding to the tax base by people paying in by spending money, and working to make it. And what is the solution I am seeing??!!!???!!!!???!!!!! Keep fuel high so more of peoples money goes into their tank......even if they work.........which means they won't spend it domestically, which means no jobs. Brilliant, absolutely brilliant!! Give those dollars to Brazil, The House of Saud, Canada, Venezuela, etc.

 

Well, at least you brilliant liberals aren't prejudice. You give the money to brown people, beige people, and people who wear turbins. Everyone but your own countrymen. Congrats, don't you feel good and special now?

 

Who was it that said------->we will destroy America without ever firing a shot!

 

Guess what fellas, they are succeeding, and they did it by convincing some of you to regurgitate their dogma, and while doing it.....actually believe you are right!!!!!!!!! Geezus H Christ, wake up!!!!!! You have been handed the greatest country/empire the world has have ever seen, and you want to make it look like a cross between Europe and the Soviet Union with a little of Cuba and China mixed in. What are you thinking!!!!!

Read and actually try to comprehend Bill Ford's commentaries about motor fuel taxation, including his rationale for establishing a price floor on those products.

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Given that not all products are made locally, how do you expect that to work?

 

Perhaps you know of a way to recover the "deadweight loss"? (Here's the definition of deadweight loss for you)

http://www.youtube.com/watch?v=zhD--UeRiOI&feature=related

 

 

Do you really think that ExxonMobil registers its domains through GoDaddy.com?

 

Now, if you have contrary information refuting that 2 cents profit per gallon claim, I ask you to provide it.

This illustrates what I was talking about in a different thread: This is a one-dimensional look at the numbers by an economist. It's clever, but it doesn't by a long shot show the whole picture. What about the "deadweight loss" of 9,000,000 unemployed? What about the "deadweight loss" of hopelessness? What about the "deadweight loss" of a nation where 90% of the inhabitants have seen their spending power decimated BECAUSE THEIR JOBS DON'T PAY WHAT THEY USED TO? We are in an economy where housing prices have fallen about 30% from their 2006 high. They were pumped up because (among other things) people were borrowing against them to fund a middle class lifestyle that their jobs could no longer support. From about 1970 (about the time imports started to really kick in), real wages per worker have stagnated and fallen, even as productivity has soared. There is only one rational explanation for this: we're in a race with Bangladesh! And the captains of industry and finance are cheering us on - as their incomes do what the data tells us they are doing. We implemented one stop-gap measure after another: send the women to work, implement widespread credit-card use, and finally hock our homes. That graph shows only a very narrow slice of the big picture. I'm afraid George Carlin - crude though his language may have been - had it exactly right:

 

Edited by retro-man
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Retro, Having a higher wage but a lower standard of living is not an improvement. If everything is more expensive, all we get is less of everything. And PLEASE stop with the jobs don't pay what they used to statements. You are right, in general they pay a lot better than they used to. Price a plumber or a mechanic or just about any skilled trade and they are making very good money. The only thing that doesn't pay as well is non-skilled strong-back, weak-mind, unskilled labor. The biggest factor in that area is the growth of automation. You still have to come to grips with the impact of the divorce rate on "family" or "household" incomes; the greatest predictor of poverty is divorce. Where the majority of children are born into single parent households it becomes a multi-generational trend.

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That's correct! In the 50 years I've held paying jobs, the most recent few have been the most lucrative for me in real terms.

 

More or less they way it should be. But on the other hand, I imagine that a burger flipper today is worse off than a burger flipper of 50 years ago.

 

I've known a few old timers who got by and raised families on jobs that today would barely support a single person.

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That is just unbelievable. Did you really say that? Are you suggesting that the government artificially make the price higher of fuel higher to support an industry? (and that is insane anyway. Toyota will eat Ford and GM for lunch)

 

I can't believe what some of these people actually think is a good idea. WHAT IS HAPPENING IN THIS COUNTRY??????

 

This is exactly why liberals are dangerous. They try to get you to do what you shouldn't have to do because they think it is a good idea, and to hell with what you think. Forget the law of supply and demand, forget the power of capitalism to lower prices, forget all that.......just do what they want, and if they screw something else up in the process they didn't consider would happen in their grand plan, so what, they feel good.

 

I have no idea what some of you people are thinking, but it is obvious you have no confidence in yourselves, or your companys/corporations. You have somehow been convinced that the the things that made this country great and stand above all others, somehow is faulty.

 

I wonder how many of you are smart enough to realize that all our domestic automakers did splendidly as long as the price of fuel was kept relatively stable. As long as the price did not swing wildly, they could outfit America in the vehicles they wanted most. And yet, your whole thinking is to lock the price of fuel waaaaaaay up there just to have a lock, so you can hope and pray your guys can again control the market, while screwing the rest of your country for what you think could be your gain. And some of you want to talk about the oil companys?!?!?!?!?!?!?!?!?!

 

Anybody with any logical thinking just does not get it. Between Obamas spending and not being able to use natural resources in this country, and good ole GW spending to boot, we are in deep doo......deep doo that can only be solved by adding to the tax base by people paying in by spending money, and working to make it. And what is the solution I am seeing??!!!???!!!!???!!!!! Keep fuel high so more of peoples money goes into their tank......even if they work.........which means they won't spend it domestically, which means no jobs. Brilliant, absolutely brilliant!! Give those dollars to Brazil, The House of Saud, Canada, Venezuela, etc.

 

Well, at least you brilliant liberals aren't prejudice. You give the money to brown people, beige people, and people who wear turbins. Everyone but your own countrymen. Congrats, don't you feel good and special now?

 

Who was it that said------->we will destroy America without ever firing a shot!

 

Guess what fellas, they are succeeding, and they did it by convincing some of you to regurgitate their dogma, and while doing it.....actually believe you are right!!!!!!!!! Geezus H Christ, wake up!!!!!! You have been handed the greatest country/empire the world has have ever seen, and you want to make it look like a cross between Europe and the Soviet Union with a little of Cuba and China mixed in. What are you thinking!!!!!

 

AMEN !

Couldn't have said it better myself. Except for that Canada part.

Must be something they put in the water.

Edited by Pete
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This illustrates what I was talking about in a different thread: This is a one-dimensional look at the numbers by an economist. It's clever, but it doesn't by a long shot show the whole picture. What about the "deadweight loss" of 9,000,000 unemployed? What about the "deadweight loss" of hopelessness? What about the "deadweight loss" of a nation where 90% of the inhabitants have seen their spending power decimated BECAUSE THEIR JOBS DON'T PAY WHAT THEY USED TO?

 

Retro, please try to clear your mind of emotion for a moment. Consider that the presentation was only trying to put the market in terms of its essence; supply and demand (what you call one-dimensional). Regardless of collateral effects, the basis of the marketplace is always supply and demand.

 

Consider what that "deadweight loss" represents. The presentation provided scenarios of no imports, imports, and imports with tariffs. In the case of imports/no imports, the surplus (be it supplier or consumer) was transferred from either supplier to consumer, or vice versa. There was no loss of efficiency as it pertains to the marketplace.

 

In a supplier surplus, the manufacturers hire more people to meet demand. Those manufacturers have now become the "demand" side of the labor market.

 

In a consumer surplus, the price of goods has come down, and even if you are making the same as you were yesterday, you can afford more today, and your standard of living improves.

 

Now in the imports with tariffs scenario, the presentation demonstrated how a portion of that surplus that would ordinarily be transferred between supply/demand surplus was lost. It was lost as in it was simply erased from existence.

 

That means it was erased from 9,000,000 peoples' opportunities to either pay less for a product or get a job producing a product. It was simply lost, with no means of returning it for the benefit of either supplier or consumer.

 

If hopelessness is what you're trying to avoid, it seems to me that preventing those lost opportunities would be what you would want.

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Retro, please try to clear your mind of emotion for a moment. Consider that the presentation was only trying to put the market in terms of its essence; supply and demand (what you call one-dimensional). Regardless of collateral effects, the basis of the marketplace is always supply and demand.

 

Consider what that "deadweight loss" represents. The presentation provided scenarios of no imports, imports, and imports with tariffs. In the case of imports/no imports, the surplus (be it supplier or consumer) was transferred from either supplier to consumer, or vice versa. There was no loss of efficiency as it pertains to the marketplace.

 

In a supplier surplus, the manufacturers hire more people to meet demand. Those manufacturers have now become the "demand" side of the labor market.

 

In a consumer surplus, the price of goods has come down, and even if you are making the same as you were yesterday, you can afford more today, and your standard of living improves.

 

Now in the imports with tariffs scenario, the presentation demonstrated how a portion of that surplus that would ordinarily be transferred between supply/demand surplus was lost. It was lost as in it was simply erased from existence.

 

That means it was erased from 9,000,000 peoples' opportunities to either pay less for a product or get a job producing a product. It was simply lost, with no means of returning it for the benefit of either supplier or consumer.

 

If hopelessness is what you're trying to avoid, it seems to me that preventing those lost opportunities would be what you would want.

So, .... we should just block imports and not collect the tariff?

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I'm afraid George Carlin - crude though his language may have been - had it exactly right:

 

Just add drugs and alcohol to keep it all simmering.

 

At $5 to $6 a gallon, man-made fuels have a market.

 

You can either give that money to the Saudis, or you can pay an American to make your fuel. Same cost. One way requires millions of American jobs. Economics 101. Why is this so difficult to figure out?

 

 

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So, .... we should just block imports and not collect the tariff?

No. In that scenario, you'd simply be denying your population the benefits of other countrys' products and knowledge; turning them into criminals as they engage in the black market. (like in the former Soviet Union)

 

We already have a policy like that with regard to illegal drugs. It's not working very well.

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