Gas This, Gas That.....

I’m setting here watching C-SPAN2 and they are talking about gas prices. Boy…you can tell how exciting my Friday nights are. I just want to take a minute here to vent a little about all of this gas stuff. Now being in the gas business for almost a year I have learned several things about this business. I listen to our congress members constantly question "Big Oils" profits. They are basically saying "Big Oil" is making too much money. There is one big problem I see with these types of slanders. Now keep in mind I’m not for "Big Oil" but there is more to this story then what’s being lead to believe.

First…China and India are using way more oil then ever before. I don’t remember the growth numbers in the last 10 years but it has put a lot more pressure on the oil companies to produce more oil.

Second…I hear congress going on and on about why wont the oil companies invest their profits in growth and build more refineries? Everything I have seen, read, or heard about this can be all fired back at our government. Not that I want to build oil fields in Alaska but what choice do we have? We complain that gas prices are to high but we do not want any oil fields in the US. We complain we depend too much on foreign oil but all the environmentalists crush any idea or development in the US. It’s a no win situation.

Third…If I hear we should all boycott Exxon one more time I think I’m going puke. What the hell is a boycott going to do but hurt the retailers. Let me give a little insight on gas pricing at the pumps. For you that live in California the numbers are probably pretty close to ours here in North Carolina. These are very general numbers but they get the point across.
The quick break down on what the retailer makes on a gallon of gas:

Example: Wholesale Gas Price $2.00 a gallon

Everyone who uses a credit card at the pump to pay for gas cost the retailer between 2% - 4% on every purchase. A $30 dollar fill up will cost the retailer about .09 cents.

Fuel charges can be as high a $200 dollars per load.

Federal taxes per gallon are about .29 cent

State taxes per gallon is about .15 cents

There is another tax and I cannot remember what they call it but it’s another .05 cents per gallon

After all of this we "the retailer" make around a whopping .02 cent a gallon profit. I know there are a few retailers that are in areas that can put the screws to consumers but those are a very small amount of retailers.

The oil companies are making about .08 - .10 cents a gallon profit according to different reports.

Do you see where the real problem is? If not let me give you a hint. Whenever you buy items in a store, go out to eat, stay at a hotel, and so on there is something all of these retails have to publish. How much you paid in taxes. The only place that it is actually illegal to do so is on gas sales. Out of the above gallon of gas sold the government makes the most money at almost .50 cents a gallon. To listen to congress go on and on about what the oil companies need to do and the thing about policing retailers is going in the wrong direction. How about if the government drops the taxes by half and we could get almost a .25 cent break in the price and the government would still by far make the most money on a gallon of gas. I also do not blame either party (Democrat or Republican)….I blame them all.

Let me add one more thing. When a retailer buys gas it's paid for up front. If the retailer buys gas today at $2.50 a gallon and gets 4000 gallons and let’s say their average sell per day is 600 gallons a day. You’re looking at roughly having about 5 days (because the pumps shut off at about 800 gallons) of fuel. Lets say tomorrow the price goes way down… your not going to see a change at the pump for at least 5 days or until the next load of gas comes in because the gas that’s in the ground at the store is already paid for at $2.50 a gallon. The retailer has to sell that gas at the correct price or they will lose their $%^. And in defense of the retailer…you don’t go into business to lose money. And remember were only talking about .02 cents a gallon profit. Not much room for error or price change for the retailer.

We have built a society that depends on oil. Yes we can make more hybrid cars, better city transportation, more car-pooling, and even better bike routs, but this is going to take time to build. Our country is so dependent on oil these changes are going to take sometime. I can’t help myself but want to blame a lot of this on Eisenhower and the interstate system. Instead of building more train routes we built more roads for cars, trucks, and so on.

Once again I’m not for "Big Oil" but the government needs to come clean and help us out. We need to build more refineries in US territories, work on other energy sources, and people need to start working together and not drive as much. I did hear they are putting more limits on Detroit and making them build cars, trucks, etc with better gas mileage, which will help in the future.

I obviously do not have the answers to make gas cheaper but I do know we need to point at some of the true problems...government!

One more tidbit…please do not by gas a Citgo because the Venezuelan president owns that company and he would love to blow the US out of the water. Every time you buy gas at Citgo you put money into his pockets.

Ok I’m going to bed…thanks for reading.