You Know What's Funny.......

(I originally posted this on Friday, December 02, 2005 when I started my first blog ever. Since then I've learned what I was doing and I deleted the original one and added this to all my others.)

For the past few weeks gas prices have been dropping by a few cents every day. Not every other day or every few days, but every day. At least in my area. Now we're down about $1 per gallon from the high of a few months ago. Why do you think that happened?
-The oil companies have the Christmas spirit and just want to give us a present?
-They realize that they have overcharged us and feel guilty?
-Oil prices have dropped that much in the past month?
-Oil refineries are producing zillions of extra gallons of oil all of a sudden?

NO, NO, NO, NO.How about this.....Senators brought in and quizzed executives of five major oil companies that, along with their parent corporations, earned more than $32.8-BILLION during the July-September quarter! As reported in the St. Petersburg Times, Lee Raymond, chairman of Exxon Mobil Corp., defended his company's profits. Petroleum earnings "go up and down" from year to year and are in line with other industries when compared with the industry's enormous revenues. I wonder if it ever went "down" enough in any year to nor allow them a huge profit? Exxon Mobil earned nearly $10-BILLION in the third quarter.

Raymond was joined at the witness table by the chief executives of Chevron Corp., ConocoPhillips Co., BP America Inc., and Shell Oil Co.
"Your sacrifice appears to be nothing", Sen. Barbara Boxer, D-Calif., told the executives, citing multimillion-dollar bonuses the officials are receiving. Senators pressed the executives to explain why gasoline prices jumped so sharply in the aftermath of Hurricane Katrina, when prices at the pump in some areas soared by $1 a gallon or more overnight.

Sen. Bill Nelson, D-Fla., asked why the industry didn't freeze prices as it did in the Sept. 11, 2001 terrorist attacks. "We had to respond to the market", said Chevron chairman David O'Reilly. Raymond said that after Sept. 11 "the industry wasn't concerned about whether there was adequate supply," as it was after this year's gulf storms. By keeping prices higher, adequate supplies were assured, he said.

Holy crap! That makes sense! If you set prices for peanut butter at $200 a jar there will be plenty of peanut butter in the stores but Little Johnny won't be eating a P&B sandwich at lunch! But I bet the oil executive's kids don't brown-bag it to school.....

Senators said that during the storm some Exxon Mobil gas station operators complained that the company had raised the wholesale price of its gas by 24 cents a gallon in 24 hours. Raymond said his company had issued guidelines "to minimize the increase in price" but said: "If we kept the price too low we would have quickly run out (of fuel) at the service station."
"It was a tough balancing act," said Raymond, who said Exxon Mobile was not price gouging. Isn't it nice to know that he was thinking about our welfare and just wanted to make sure we had plenty of gas? Well, that is, if you could afford to buy a couple of gallons instead of buying food or paying your rent.....

Some lawmakers have suggested the oil companies should funnel some of their earnings to supplement a federal program that helps low-income households pay heating bills. That brought a cool reception from the executives. "As an industry we feel it is not a good precedent to fund a government program," said James Mulva, chairman of ConocoPhilips.

Now here's a great example of a stupid government official when she's allowed to open his mouth and speak in public: The head of the Federal trade Commission said a federal price-gouging law "likely will do more harm than good."
"While no consumers like price increases, in fact, price increases lower demand and help make the shortage shorter-lived than it otherwise would have been," FTC chairwoman Deborah Platt Majoras told the hearing. "That's an astounding therory of consumer protection," replied Sen. Ron Wyden, D-Ore.ConocoPhilips earned $3.8-billion in the third quarter, an 89 percent increase over a year earlier.
But Mulva said that represents only a 7.7 percent profit margin. "We do not consider that a windfall," he said.
Hey folks, I won't even give you a response to that one...You can come up with your own I'm sure!

So....Enough of that business talk. Let me just give you some facts about these big five execs that are defending their price increases. You might be able to see a pattern here of why it is to their benefit to make a lot of money for their companies.

Here is a list of the executives, their company's third quarter profits and, more importantly, their individual salary compensation for 2004:

-Lee Raymond: Exxon Mobil CEO -Profits: $9.9-billion (+75%) -Compensation: $38.1million.
-John Hofmeister: Shell Oil president - Profits: $9.4-billion (+67%) -Compensation: N/A*
-Ross Pillari: BP America CEO - Profits: $6.5-billion (+34%) -Compensation: N/A* -James Mulva: ConocoPhilips CEO - Profits: $3.8-billion (+89%) -Compensation: $12.7-million.
-David O'Reilly: Chevron CEO - Profits: $3.6-billion (+12%) -Compensation: $6.5-million.
* Foreign-owned companies do not report all salary information for U.S.-based executives.

How embarrassing it must be for O'Reilly at the country club for all to know that he made less than his fellow-comrades in thievery!

So there you have it. The short of it is, don't you really think that we are seeing the price decrease so much in one month because of this Senate hearing and these facts brought to light? And, hey, the fact that it's Christmas can't hurt. They know we'll be out driving and buying presents so we'll still be burning up tons of gas to get to the stores.

What do you want to bet that after the first of the year we'll see the prices going back up? And isn't it funny that when they drop they do so by a penny or two a day. But when they rise they can jump as much as 20 cents or more in one day!

We can still control the prices, even with them falling below $2 a gallon now. Just read my first blog and let's pick a oil company to boycott. Wouldn't you like to see gas at $0.79 a gallon??

But let's not start with Chevron. O'Reilly is almost in the poor-house now.