(OT:) The price of a barrel goes up...

You should look at how Valero and Sunoco are doing. Both are companies that have refineries and gas stations, but don't drill or pump their own crude. Neither one is making a lot of money at the moment.

Also, you should try to back your claim that the price of gas goes up IMMEDIATELY, if you can.

Jeff

Gee, Jeff, do you pay much attention?

I'll be listening to the radio, as I often do, and they'll announce "the price of a barrel of oil hit a new high today, selling for $xxx per barrel" and by the time I go to the store for my evening coffee the price has gone up.

All is takes is a little observation. The manager of the store told me she tries to hold it off as long as possible, but can't always.

You should talk to people, other than from behind a keyboard. And pay attention. Either you and I, or DH and I had this conversation the last time the price of oil dropped...it took 4 days for the decrease to hit the pumps.

And you know that is in response to today's price change of crude oil how? Maybe it was in response to the price of crude oil two weeks ago. Or two months ago. How do know what it is changing in response to? I have notice that the difference in price between midgrade and regular is

10 cents and the different between hi-test and regular is 20 cents. OTher times the difference are higher. How do you explain this?

There are things that affect the price of gasoline, particularly regional supply and demand things, that neither or nor I are privy to.

She tries to hold off as long as possible from what? The price change of crude oil or the price change from the refinery? Does the manager even know what causes the daily variation in the price of gasoline? I mean, all she cars about is the bottom line, not the reasons for the daily changes of the cost of gas.

And you know that that price change was response to the crude oil price change four days earlier how?

Just because you and I have different views does not mean that either of us is not paying attention. All it means is that we're paying attention to different things.

Jeff

Jeff is living in some other planet besides the one we're on. I've seen gas prices go up more than once in the same week. It used to be they'd at least wait until Thursday to jump the price. Some of the gas stations in the ritzy neighborhoods are now charging 4.25 here. And he didn't live in Arkansas in 1990, the week before Saddam invaded Kuwait, when all the gas dealers in town got a call from their distributors to immediately raise their price from 86.9 to 99.9 or they wouldn't get ANY more gas. That was more than a day before Saddam crossed the border. At that point, most people saw no reason for gas to jump 13 percent in one day. We figure Big Oil had something to do with the Iraq war.

Charles the Curmudgeon

You're kidding, right?

Do you get out much? Listen to the radio much? Watch TV much?

No, it's not in response to "last week". Back when price increases weren't coming every two hours, there was NO lag time between an announcement of the increase in the price of a barrel and the increase at the pumps.

The price here goes up every time the price of a barrel goes up.

Charles,

I am not questioning that gas prices go up. Obviously, they do. However, what drives the gas prices up on a particular day, we don't know. What goes on between a gas station manager and the distributer, we don't know either. Obviously, the crude oil price increase is the main factor that is causing the gas prices to go up. However, we don't know the timing of how a particular crude oil price increase is passed on to the consumer.

Jeff

Not in the least.

Show that the crude oil price increase that were made this morning are passed on today. Show us.

Yeah, but prove the timing.

Jeff

Read the WSJ, and get a hold of a decent news service. And get out from behind the keyboard.

*You* don't know. I talk to people. People who know, not some keyboard genius.

And your next sentence I clipped: "What goes on between the store manager and the distributor..."

Like I said, you need to talk to people. Really. You can learn a lot.

Yes, Jeff, the price increase you hear on the radio gets passed along ASAP.

But the point of the OP was, WHY DON'T DECREASES?

We have had increases of 2-4 cents a gallon here every time a rise in the price of a barrel is announced.

In other words, you are pulling a Mike Hunter and can't back your claims.

Jeff

You're trying to pull a Mike Hunter. You have to show how long it takes for increases or decreases to get passed on.

Let's see what this quarter's profits are. Remember, the gas companies keep telling us they have to raise prices to keep up with 'costs'.

So, if they're merely keeping up with 'costs', why is every quarter a record profit?

Only if the don't want to go out of business.

I mean, what alternative do they have?

Sunoco's cash flow was down about 2/3 and Sunoco actually lost $59,000,000 last quarter (ending March 31, 2008).

Valero had operating margins of $12.15 per barrel last year (first quarter), but that went down to $8.48 per barrel this year (first quarter). Valero made $1673 million last year (first quarter), but only $472 million first quarter this year.

ExxonMobil had $398 million profit for it US downstream operations in the first quarter this year. (Downstream means refining and marketing, like running gas stations and delivery fuel to gas stations.) That's down from $839 million from last year's first quarter.

Clearly, refinery operations are not making as much money as last year.

This year, ExxonMobil made $2.313 billion in the US (upstream, downstram and chemical operations), while it made $2.362 billion last year in the US, or $49 million more last year than this year in the US. So ExxonMobil didn't have record profits on US operations.

So the increased profits were because of international operations, not US operations.

And Valero and Sunoco both made less money this year (first quarter) than last year (first quarter); Sunoco actually had a GAAP loss, although its cash flow was positive.

Jeff

Jeff is such a sheeple that he's on my blocked list. If I want what he's selling, I can buy it in 40 pound sacks at Wal-Mart. I had friends that OWNED gas stations in Arkansas years ago that told me these things. They were in fact threatened by their distributor the Thursday before Saddam invaded Kuwait in 1990 to raise their prices or else.

Charles the Curmudgeon.

Oil went DOWN today, it's 9 dollars off peak. So why did every gas station around here that wasn't already there jump from 4.13 to 4.25? Hmmmm?

Liberalism is a mental disease.

Charles the Curmudgeon

From the information you provided, it is not obvious the price of gasoline rose every time the price of crude rose. At best you've shown that the price of gas did not go up proportionally as much as the price of crude. Perhaps your 3% CO2 atmosphere is affecting your mental process, as it did when you said the Federal Reserve didn't exist in the early 1940s. ;)

Actually, if you subtract the cost of transportation, refining and taxes, then I think you would find that the price of gasoline is pretty closely related to the cost of crude oil. However, it is not perfectly related. Politics and supply and demand play a role, as do other factors.

Jeff