Re: Record oil company profits

richard <i.do.not@xxxxx> wrote in
news:96tk14ppkgb1jjf1e9svc9gt2nvo6r8ml4@xxxxxxx:

How is it then they can make such huge profits when the stations
insist they only make 3 cents a gallon? Yet the company can turn
around and give back 25 cents a gallon? Somethin ain't adding up here.
Not only are we consumers getting ripped off, but the poor slob
running the station is getting royally ripped off.

It's very simple, and here's a little economics lesson that should
hopefully clear up any confusion for those with little upstairs to work
with.

If you were to change careers from being a professional hobo and decided
to go to your local hardware store and purchase a nice new, one gallon
gasoline jug, then trod off to the nearest station and fill it with
gasoline, then stand by the road to sell it to someone who needs it for
ten cents above what it cost you, and you happen to sell it, you've made
ten cents on that gallon of gas.

The next day you fill it twice, and sell those two gallons, again for
ten cents above what it cost you, you've made twenty cents that day.

The third, you sell three gallons, and you've made thirty cents...

Then you get smart and you decide to buy a couple more jugs, since this
is going well, in order to reduce the trips to fill those jugs, and you
sell more and more gas at a time.

The more gallons of gas you sell, the more profit you make.

Now translate that throughout all the places that the oil companies
provide gasoline.

Imagine for a minute that with a decade of sales of SUV's in this
country alone, how that has impacted the need for more fuel to operate
them, combined with the fact that people on average, are living farther
away from where they work, and the fact that if you shop for a used
vehicle, that you will find that people are putting enormous amounts of
miles on a vehicle each year.

Then imagine for a minute that there are people all over the world who
might need gasoline, and you decide to expand your operations to provide
that gas to those people as well, in order to keep growing your
business.

When you digest all of this, it's not a surprise at all why the oil
companies are reporting record profits. They are selling record amounts
of petroleum products.

This concept really shouldn't be lost on any truck driver out here who
is or has been paid mileage for their work. You know the rate, and you
know how to add up how much you will make, depending on how many miles
you drive.

You drive more miles, you make more money. You drive less miles, you
make less money.

The oil companies are just like truck drivers. The more gallons they
sell, the more they make. Their profit margins (the amount over and
above what it costs them per gallon to bring products to the market)
have remained steady for four decades. If they were making more per
gallon, then people would have something to bitch about, but that is not
the case. Their sales are up, due to demand for their product, and not
because they are gouging a soul.


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