Some real answers to high fuel prices
The futility of a “Gas War.”
I received the following in an email from a friend:
(I do not think it will have any effect.)
GAS WAR - an idea that WILL work
This was originally sent by a retired Coca Cola executive It came from one of his engineer buddies who retired from Halliburton. It's worth your consideration.
Join the resistance!!!! I hear we are going to hit close to $ 4.00 a gallon by next summer and it might go higher!! Want gasoline prices to come down? We need to take some intelligent, united action.
Phillip Hollsworth offered this good idea. This makes MUCH MORE SENSE than the "don't buy gas on a certain day" campaign that was going around last April or May! The oil companies just laughed at that because they knew we wouldn't continue to "hurt" ourselves by refusing to buy gas. It was more of an inconvenience to us than it was a problem for them. BUT, whoever thought of this idea, has come up with a plan that can really work. Please read on and join with us!
By now you're probably thinking gasoline priced at about $1.50 is super cheap. Me too! It is currently $2.79 for regular unleaded in my town. Now that the oil companies and the OPEC nations have conditioned us to think that the cost of a gallon of gas is CHEAP at $1.50 - $1.75, we need to take aggressive action to teach them that BUYERS control the marketplace..not sellers. With the price of gasoline going up more each day, we consumers need to take action. The only way we are going to see the price of gas come down is if we hit someone in the pocketbook by not purchasing their gas! And, we can do that WITHOUT hurting ourselves. How?
Since we all rely on our cars, we can't just stop buying gas. But we CAN have an impact on gas prices if we all act together to force a price war.
Here's the idea: For the rest of this year, DON'T purchase ANY gasoline from the two biggest companies (which now are one), EXXON and MOBIL. If they are not selling any gas, they will be inclined to reduce their prices. If they reduce their prices, the other companies will have to follow suit. But to have an impact, we need to reach literally millions of Exxon and Mobil gas buyers. It's really simple to do! Now, don't wimp out on me at this point...keep reading and I'll explain how simple it is to reach millions of people!!
I am sending this note to 30 people. If each of us send it to at least ten more (30 x 10 = 300) ... and those 300 send it to at least ten more (300 x 10 = 3,000)...and so on, by the time the message reaches the sixth group of people, we will have reached over THREE MILLION consumers.
If those three million get excited and pass this on to ten friends each, then 30 million people will have been contacted! If it goes one level further, you guessed it..... THREE HUNDRED MILLION PEOPLE!!!
Again, all you have to do is send this to 10 people. That's all! (If you don't understand how we can reach 300 million and all you have to do is send this to 10 people.... Well, let's face it, you just aren't a mathematician. But I am .. so trust me on this one.) :-)
How long would all that take? If each of us sends This e-mail out to ten more people within one day of receipt, all 300 MILLION people could conceivably be contacted within the next 8 days!!! I'll bet you didn't think you and I had that much potential, did you! Acting together we can make a difference.
If this makes sense to you, please pass this message on. I suggest that we not buy from EXXON/MOBIL UNTIL THEY LOWER THEIR PRICES TO THE $1.30 RANGE AND KEEP THEM DOWN. THIS CAN REALLY WORK
Calvin Burr Barbara Burr Dayton, Nevada
My response:
The "Gas War" is a great sounding idea but would have little effect on gasoline prices even if everyone shunned Exxon/Mobil. It would be a minor inconvenience to EM, but could cost loss of income to many lowly gas station workers. I spent several years as an engineer in the oil industry and although not an expert, I do have a fair understanding of how oil companies make money and it isn't at the retail level.
Most, but not all, oil companies make their money at the producing and wholesale level–the difference between the cost of petroleum at the well head or delivered to the refinery and the wholesale price of gasoline to retail stores. For example: While the market price for crude is in the mid-sixties per barrel, producers in the US can have costs at the well head of just s few dollars a barrel–say $5.00. Producing wells with delivered costs of as high as $50.00 per barrel become profitable when market price is in the sixties. For this reason, many wells in the US that were capped and shut down a few years ago have since been reopened and are producing profits for their owners. Should the market price of crude remain where it is or even go higher, many more old wells, even entire oil fields, will be reopened and turned into profit producers. This is where the major oil companies make most of their profits. As long as Americans use petroleum based fuel, no matter where or from whom they buy it, the major oil companies like EM will continue to make huge profits.
In addition, just because the market price for crude is $65.00 per barrel doesn’t mean that’s the price the major oil companies pay for crude. Many oil companies have their own contracts with producers at rates far below the market price. While those buying petroleum on the open market may be paying $65.00 per barrel, delivery contracts with major oil companies may be pegged at $10 to $20 per barrel below the market. Still, fuel at the pump is base-line priced as if all petroleum cost the market price. The rational is that should a company have to purchase petroleum on the open market, it would cost them market price. So that is where they set the value of their entire inventory stocks of crude. This then becomes the determining factor in pricing at both the wholesale and the retail level.
Many independent oil companies like Speedway and Flying J buy their fuel from distribution centers who buy their fuel from the major oil company refineries. Both refineries and distributors “swap stocks” on the two wholesale levels. This means that both wholesale distributors and local stations take deliveries of fuel from sources that usually include the major oil companies. In some areas, there may be twenty different brands of retail fuels that all come from the same source. These are sometimes formulated by the refinery or distributor to meet certain specifications, but often EM tankers deliver gas from the same truck and from the same stock to several competing stations. I’ve even seen a single tanker unload fuel at say, an EM station, and then drive across the street and deliver the rest of the load to a Texaco or BP or Shell station. Many independent stations sell gas at a break-even price just to get people to stop and shop in their stores and all their profits are made on food, beverages and other supplies which have huge profit margins, but are convenient and seldom have their prices questioned. Ever hear of a beverage or candy war? It never happens.
The best and most practical method to lower gas prices is actually simpler even than a “gas war.” The development, promotion and use of renewable, mostly biological fuels would not only lower our fuel costs, but would stop the dangerous increases of carbon dioxide in the atmosphere and reverse one of man’s most environmentally destructive effects. This is slowly and 0quietly beginning to happen because of economic forces. My hope is that people will stop being mesmerized by far out dreams of hydrogen and hydrogen fuel cell vehicles and get on the biofuel bandwagon. Not only is this quite practical, and with huge environmental benefits, but the trillions of dollars now going out of our country for increasingly expensive petroleum would stay here at home. What a huge boost to our economy that would be. It would, in fact, reverse our balance of payments which is draining so much wealth from our people and economy.
OK, here’s the pitch: I have written and rewritten and I am continuing to update a book, “The Tribrid Vehicle Economy” which completely outlines the energy industry and how we should be changing it. These changes promise almost unbelievable benefits to not just the US and our people, but to the entire world. My question to all people of all political persuasions is, Why aren’t you promoting this in the media and in person in every way that can be imagined? I think I know why and why we are spending such monstrous amounts of money in countless studies and research and development projects without providing any concrete solutions.
The answer? Members of these organizations who do these studies and do the research do not want to solve the problems they are addressing. This is for purely economic reasons. They know that if they solve the problem, their reason to work and study ceases to exist and they will lose their jobs and income. For this reason and this reason alone there are billions of dollars being spent on hydrogen fuel cell research and development. Those involved in the research on components for the so called “Hydrogen Economy” and receiving billions from our government know they are pursuing a dead end. They know the solution to the problems lie many years in the future and that even then the costs would be prohibitive. These researcher know that they have a secure financial future for as long as the government grants keep coming in. They do not want a solution to the problem as it will derail their gravy train.
The oil companies have a stake in this as well and for the same reason. As long as the promise of a future with cheap, clean energy persists, they will continue to reap profits free from serious competition. The carrot of future wonder fuel effectively keeps the public’s eyes diverted from all real solutions that threaten the profits of “big oil.”
New York Times science reporter, Mathew L. Wald sums up the hydrogen fuel-cell promise in a few words:
“Despite the technological and infrastructure obstacles, a hydrogen economy may be coming. If it is, it will more likely resemble the perfume economy, a market where quantities are so small that unit prices do not matter. It will appear in items like cellular phones and laptop computers.”
The only real hope for an effective answer from those proposed in "The Tribrid Vehicle Economy" is inventive and creative Americans defying the efforts of the massive oil industry. Men who will use our free enterprise system to develop renewable and biofuel systems even without huge government grants. Right now there are numerous small biofuel entrepreneurs designing and building plants that use agricultural products, even waste products, to produce liquid fuels like biodiesel, ethanol and ethanol at prices far below those of petro-fuels. Click here to view an article about one such plant near my home. There is much unheralded, mostly private research into new sources including some plant stocks that produce far more useable oil per acre than traditional crops like rapeseed, soybean and sunflower. It is my sincere hope that this small start will bring on a ground swell of support and participation from many Americans. While the government and overfunded research groups struggle to solve the unsolvable, enterprising individuals are forging ahead with practical solutions with readily available technologies. My bet is that these private efforts will solve the problem long before the “Hydrogen Economy” researchers get even a reasonable start.
I received the following in an email from a friend:
(I do not think it will have any effect.)
GAS WAR - an idea that WILL work
This was originally sent by a retired Coca Cola executive It came from one of his engineer buddies who retired from Halliburton. It's worth your consideration.
Join the resistance!!!! I hear we are going to hit close to $ 4.00 a gallon by next summer and it might go higher!! Want gasoline prices to come down? We need to take some intelligent, united action.
Phillip Hollsworth offered this good idea. This makes MUCH MORE SENSE than the "don't buy gas on a certain day" campaign that was going around last April or May! The oil companies just laughed at that because they knew we wouldn't continue to "hurt" ourselves by refusing to buy gas. It was more of an inconvenience to us than it was a problem for them. BUT, whoever thought of this idea, has come up with a plan that can really work. Please read on and join with us!
By now you're probably thinking gasoline priced at about $1.50 is super cheap. Me too! It is currently $2.79 for regular unleaded in my town. Now that the oil companies and the OPEC nations have conditioned us to think that the cost of a gallon of gas is CHEAP at $1.50 - $1.75, we need to take aggressive action to teach them that BUYERS control the marketplace..not sellers. With the price of gasoline going up more each day, we consumers need to take action. The only way we are going to see the price of gas come down is if we hit someone in the pocketbook by not purchasing their gas! And, we can do that WITHOUT hurting ourselves. How?
Since we all rely on our cars, we can't just stop buying gas. But we CAN have an impact on gas prices if we all act together to force a price war.
Here's the idea: For the rest of this year, DON'T purchase ANY gasoline from the two biggest companies (which now are one), EXXON and MOBIL. If they are not selling any gas, they will be inclined to reduce their prices. If they reduce their prices, the other companies will have to follow suit. But to have an impact, we need to reach literally millions of Exxon and Mobil gas buyers. It's really simple to do! Now, don't wimp out on me at this point...keep reading and I'll explain how simple it is to reach millions of people!!
I am sending this note to 30 people. If each of us send it to at least ten more (30 x 10 = 300) ... and those 300 send it to at least ten more (300 x 10 = 3,000)...and so on, by the time the message reaches the sixth group of people, we will have reached over THREE MILLION consumers.
If those three million get excited and pass this on to ten friends each, then 30 million people will have been contacted! If it goes one level further, you guessed it..... THREE HUNDRED MILLION PEOPLE!!!
Again, all you have to do is send this to 10 people. That's all! (If you don't understand how we can reach 300 million and all you have to do is send this to 10 people.... Well, let's face it, you just aren't a mathematician. But I am .. so trust me on this one.) :-)
How long would all that take? If each of us sends This e-mail out to ten more people within one day of receipt, all 300 MILLION people could conceivably be contacted within the next 8 days!!! I'll bet you didn't think you and I had that much potential, did you! Acting together we can make a difference.
If this makes sense to you, please pass this message on. I suggest that we not buy from EXXON/MOBIL UNTIL THEY LOWER THEIR PRICES TO THE $1.30 RANGE AND KEEP THEM DOWN. THIS CAN REALLY WORK
Calvin Burr Barbara Burr Dayton, Nevada
My response:
The "Gas War" is a great sounding idea but would have little effect on gasoline prices even if everyone shunned Exxon/Mobil. It would be a minor inconvenience to EM, but could cost loss of income to many lowly gas station workers. I spent several years as an engineer in the oil industry and although not an expert, I do have a fair understanding of how oil companies make money and it isn't at the retail level.
Most, but not all, oil companies make their money at the producing and wholesale level–the difference between the cost of petroleum at the well head or delivered to the refinery and the wholesale price of gasoline to retail stores. For example: While the market price for crude is in the mid-sixties per barrel, producers in the US can have costs at the well head of just s few dollars a barrel–say $5.00. Producing wells with delivered costs of as high as $50.00 per barrel become profitable when market price is in the sixties. For this reason, many wells in the US that were capped and shut down a few years ago have since been reopened and are producing profits for their owners. Should the market price of crude remain where it is or even go higher, many more old wells, even entire oil fields, will be reopened and turned into profit producers. This is where the major oil companies make most of their profits. As long as Americans use petroleum based fuel, no matter where or from whom they buy it, the major oil companies like EM will continue to make huge profits.
In addition, just because the market price for crude is $65.00 per barrel doesn’t mean that’s the price the major oil companies pay for crude. Many oil companies have their own contracts with producers at rates far below the market price. While those buying petroleum on the open market may be paying $65.00 per barrel, delivery contracts with major oil companies may be pegged at $10 to $20 per barrel below the market. Still, fuel at the pump is base-line priced as if all petroleum cost the market price. The rational is that should a company have to purchase petroleum on the open market, it would cost them market price. So that is where they set the value of their entire inventory stocks of crude. This then becomes the determining factor in pricing at both the wholesale and the retail level.
Many independent oil companies like Speedway and Flying J buy their fuel from distribution centers who buy their fuel from the major oil company refineries. Both refineries and distributors “swap stocks” on the two wholesale levels. This means that both wholesale distributors and local stations take deliveries of fuel from sources that usually include the major oil companies. In some areas, there may be twenty different brands of retail fuels that all come from the same source. These are sometimes formulated by the refinery or distributor to meet certain specifications, but often EM tankers deliver gas from the same truck and from the same stock to several competing stations. I’ve even seen a single tanker unload fuel at say, an EM station, and then drive across the street and deliver the rest of the load to a Texaco or BP or Shell station. Many independent stations sell gas at a break-even price just to get people to stop and shop in their stores and all their profits are made on food, beverages and other supplies which have huge profit margins, but are convenient and seldom have their prices questioned. Ever hear of a beverage or candy war? It never happens.
The best and most practical method to lower gas prices is actually simpler even than a “gas war.” The development, promotion and use of renewable, mostly biological fuels would not only lower our fuel costs, but would stop the dangerous increases of carbon dioxide in the atmosphere and reverse one of man’s most environmentally destructive effects. This is slowly and 0quietly beginning to happen because of economic forces. My hope is that people will stop being mesmerized by far out dreams of hydrogen and hydrogen fuel cell vehicles and get on the biofuel bandwagon. Not only is this quite practical, and with huge environmental benefits, but the trillions of dollars now going out of our country for increasingly expensive petroleum would stay here at home. What a huge boost to our economy that would be. It would, in fact, reverse our balance of payments which is draining so much wealth from our people and economy.
OK, here’s the pitch: I have written and rewritten and I am continuing to update a book, “The Tribrid Vehicle Economy” which completely outlines the energy industry and how we should be changing it. These changes promise almost unbelievable benefits to not just the US and our people, but to the entire world. My question to all people of all political persuasions is, Why aren’t you promoting this in the media and in person in every way that can be imagined? I think I know why and why we are spending such monstrous amounts of money in countless studies and research and development projects without providing any concrete solutions.
The answer? Members of these organizations who do these studies and do the research do not want to solve the problems they are addressing. This is for purely economic reasons. They know that if they solve the problem, their reason to work and study ceases to exist and they will lose their jobs and income. For this reason and this reason alone there are billions of dollars being spent on hydrogen fuel cell research and development. Those involved in the research on components for the so called “Hydrogen Economy” and receiving billions from our government know they are pursuing a dead end. They know the solution to the problems lie many years in the future and that even then the costs would be prohibitive. These researcher know that they have a secure financial future for as long as the government grants keep coming in. They do not want a solution to the problem as it will derail their gravy train.
The oil companies have a stake in this as well and for the same reason. As long as the promise of a future with cheap, clean energy persists, they will continue to reap profits free from serious competition. The carrot of future wonder fuel effectively keeps the public’s eyes diverted from all real solutions that threaten the profits of “big oil.”
New York Times science reporter, Mathew L. Wald sums up the hydrogen fuel-cell promise in a few words:
“Despite the technological and infrastructure obstacles, a hydrogen economy may be coming. If it is, it will more likely resemble the perfume economy, a market where quantities are so small that unit prices do not matter. It will appear in items like cellular phones and laptop computers.”
The only real hope for an effective answer from those proposed in "The Tribrid Vehicle Economy" is inventive and creative Americans defying the efforts of the massive oil industry. Men who will use our free enterprise system to develop renewable and biofuel systems even without huge government grants. Right now there are numerous small biofuel entrepreneurs designing and building plants that use agricultural products, even waste products, to produce liquid fuels like biodiesel, ethanol and ethanol at prices far below those of petro-fuels. Click here to view an article about one such plant near my home. There is much unheralded, mostly private research into new sources including some plant stocks that produce far more useable oil per acre than traditional crops like rapeseed, soybean and sunflower. It is my sincere hope that this small start will bring on a ground swell of support and participation from many Americans. While the government and overfunded research groups struggle to solve the unsolvable, enterprising individuals are forging ahead with practical solutions with readily available technologies. My bet is that these private efforts will solve the problem long before the “Hydrogen Economy” researchers get even a reasonable start.
posted by HoJo | 9:48 AM
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