Who bought gas on May 15th?

[Kerplunk]

Originally Posted by SeeGeeWhy

Both, I wasn't looking at that sentence as two seperate statements.

I don't agree that people can be gouged on a luxury item such as gasoline. The price is going to be whatever people are willing to pay for it.

It is quite unreasonable of "you" (the complaining customer) to expect the merchant of such a product to not take as much profit as he can if the demand for the product is there just because his customer feels entitled to it.

People will complain about gas prices so long as they feel entitled to gasoline and that they have no other options.

One of the problems I have is that there really no competition in the market. If I go to buy clothing and one place sells it for too much, I can go somewhere else. Stations in Calgary have a wonderful habit of all being the same, forcing the customer to pay a single price.

The other thing is that, since oil prices are world-wide we should be able to expect the goods being produced from it to follow a somewhat similar pricing curve. But, when the price of oil goes down the companies are using goods "in the pipe", but are quick to jack up the costs when the oil price inflates.

At what point does a luxury item start to become less of a luxury and more of a necessity? I need a car, one way or the other, to get to work. Society in general, for good of bad, rely on the goods produced from oil. Until the "other options" you mention become viable solutions, or the gas companies float the prices closer to what is expected based on oil prices, I will continue complaining about it.

[Bring_Back_Shantz]

Originally Posted by Ayrahb

I expected this question.

Total revenue for 2006 -- $6,579,866

Provincial Government -- 37%
Federal Government -- 31%
User Fees -- 21%
Municipal Government -- 6%
Other -- 5%

Total Donations -- $35,522

Fair enough, but ~30% of the Government of Alberta's revenue is from the oil and gas sector, not to mention income tax collected from those in the Oil and gas industry. So yes, you are affected quite signifigantly (if not indirectly) by the oil and gas industry. If it dried up, how much funding do you think it would be for non profit programs such as yours?

[Bring_Back_Shantz]

Originally Posted by Kerplunk

One of the problems I have is that there really no competition in the market. If I go to buy clothing and one place sells it for too much, I can go somewhere else. Stations in Calgary have a wonderful habit of all being the same, forcing the customer to pay a single price.

With a relatively small number of refineries that the gas can come from this really isn't too unexpected. If every gas station is buying from the same refineries, they pay the same tax, and they want the same profit margin then of course they will be charging the same price. For the price to drop at a station, they have to take a cut in their profits, and unless they can guarantee to make that loss up through more business they aren't going to do it.

[SeeGeeWhy]

Originally Posted by Kerplunk

One of the problems I have is that there really no competition in the market. If I go to buy clothing and one place sells it for too much, I can go somewhere else. Stations in Calgary have a wonderful habit of all being the same, forcing the customer to pay a single price.

The other thing is that, since oil prices are world-wide we should be able to expect the goods being produced from it to follow a somewhat similar pricing curve. But, when the price of oil goes down the companies are using goods "in the pipe", but are quick to jack up the costs when the oil price inflates.

At what point does a luxury item start to become less of a luxury and more of a necessity? I need a car, one way or the other, to get to work. Society in general, for good of bad, rely on the goods produced from oil. Until the "other options" you mention become viable solutions, or the gas companies float the prices closer to what is expected based on oil prices, I will continue complaining about it.

I do see your point about the perception of a silent cartel (i.e. lack of open competition), I am likely to believe what cowboy89 said about it being about controlling product availability and protecting company reputation for being reliable. BBS has a great point, too.

I fully disagree that you NEED to drive to get to work. That is 100% a direct consequnce of your own choices.

I am perfectly happy walking into work each day and spending less than $80/month on gas. It has nothing to do with the viablity of green technology, or floating gas prices closer to what is expected based on oil prices, and has everything to do with my lifestyle choices.

And really, if you were selling gas, wouldn't you get as much profit as you could, or would you be the saviour of the masses and deliver your product
at a more consistent and reasonable profit margin? Give me a break. That sort of action would be grossly irresponsible for a public corporation and inhumanly generous for a private owner to undertake.

Think beyond your own wallet for a change, Mr. Consumer.

[Kerplunk]

Originally Posted by SeeGeeWhy

I do see your point about the perception of a silent cartel (i.e. lack of open competition), I am likely to believe what cowboy89 said about it being about controlling product availability and protecting company reputation for being reliable. BBS has a great point, too.

I fully disagree that you NEED to drive to get to work. That is 100% a direct consequnce of your own choices.

I am perfectly happy walking into work each day and spending less than $80/month on gas. It has nothing to do with the viablity of green technology, or floating gas prices closer to what is expected based on oil prices, and has everything to do with my lifestyle choices.

And really, if you were selling gas, wouldn't you get as much profit as you could, or would you be the saviour of the masses and deliver your product
at a more consistent and reasonable profit margin? Give me a break. That sort of action would be grossly irresponsible for a public corporation and inhumanly generous for a private owner to undertake.

Think beyond your own wallet for a change, Mr. Consumer.

I agree that there is, to a point, that production through the refineries is a bottleneck. I become concerned when some of the bigger oil companies ALSO run the refineries.

And assuming that I have that much choice in how I get to work is very narrow minded. Some people just don't have the same options you do.

[SeeGeeWhy]

Originally Posted by Kerplunk

I agree that there is, to a point, that production through the refineries is a bottleneck. I become concerned when some of the bigger oil companies ALSO run the refineries.

And assuming that I have that much choice in how I get to work is very narrow minded. Some people just don't have the same options you do.

Where do you work and where do you live?

[Kerplunk]

Originally Posted by SeeGeeWhy

Where do you work and where do you live?

Live in Temple, work in the industrial park by Chinook.

[Cowboy89]

Originally Posted by Kerplunk

I agree that there is, to a point, that production through the refineries is a bottleneck. I become concerned when some of the bigger oil companies ALSO run the refineries.

And assuming that I have that much choice in how I get to work is very narrow minded. Some people just don't have the same options you do.

Oil companies are no more evil than the family owned business down the street. It's a marketplace, sometimes you have to pay more for things for a variety of reasons, deal with it. Just as often as you get 'gouged' for things it works the other way around too. But when a situation arises where a big faceless corporation losses money selling you things, it's somehow called a fair price.

It's not only Oil and Gas companies that try to maximize profits. I don't see why this is any different than phone companies charging for phone service, you NEED a phone don't you????? Oh yeah AND a wireless phone too, why not start regulating their business much more heavily too. Oh yeah and you NEED a bed, and they cost so much these days, why not haul Sleep Country in front of a parliamentary commitee too. Why not regulate food and make Safeway charge you less for groceries because you don't feel like paying for those either?

[Kerplunk]

Originally Posted by Cowboy89

It's not only Oil and Gas companies that try to maximize profits. I don't see why this is any different than phone companies charging for phone service, you NEED a phone don't you????? Oh yeah AND a wireless phone too, why not start regulating their business much more heavily too. Oh yeah and you NEED a bed, and they cost so much these days, why not haul Sleep Country in front of a parliamentary commitee too. Why not regulate food and make Safeway charge you less for groceries because you don't feel like paying for those either?

Every service/company you listed also have a competitor that you can go to that will, in all likelyhood, charge different prices. Do you not shop around? Some good deals on now.

[Cowboy89]

There are 12 different companies that own refineries in Canada and numerous more retailers of gas as well. The thing though is that they are selling the exact same product that gets posted on the outside of their store allowing for competitors to see and match price. All it takes is one company to lower their prices by 5 cents a litre before everyone else within reasonable driving distance lower's their prices too. It's a real effort to price shop for other goods and services and those 'different prices' are actually differing levels of prices above and beyond the lowest competitive price. So you would be happy if Shell charged $1.50/litre, while Esso Charged $1.75/litre, and Petro-Canada charged $1.20/litre while Husky charged $1.16/litre but none of them showed you the price until you got into the store?

I'd argue that gas prices are 80 times more transparent than any of the other goods and services you buy. Due to that the competitors are in tune with other's prices and generally don't have the ability to charge more than the guy across the street.

[Dynamic]

Just filled up 47 bucks for a little Honda Civic. That will get me to work and back 3 times. This sucks.

[Julio]

A couple of thoughts on the thread:

First, doing gasoline boycotts is a throwaway gesture that means nothing. People will just buy gas the day before or after...other posters have done a better job of talking about the whole reasons behind price flucuations and the lack of refining capacity.

As far as a longterm way of reducing oil consumption...it's not easy but there are ways to reduce your personal usage. Obviously the easiest is to not drive a big SVU by yourself for 50 km a day to commute. I live close to where I work, and part of that decision was looking at the cost of commuting as opposed to paying a higher rent/mortgage (I live in Bankview). Given I only live a few km from work, I also bike a couple times a week from April to October. I buy gas maybe twice a month. If more people took the approach to live closer to where they work, not just here in Calgary but elsewhere, it would do a whole lot more good than a one day protest.

[Locke]

Originally Posted by Julio

A couple of thoughts on the thread:

First, doing gasoline boycotts is a throwaway gesture that means nothing. People will just buy gas the day before or after...other posters have done a better job of talking about the whole reasons behind price flucuations and the lack of refining capacity.

Hey, it was this or Venezuelan Dirt farming.

Locke.

PS. Okay, thats it, no more Venezuelan dirt farming jokes today. I'm done. I promise.

[Flames in 07]

Originally Posted by Displaced Flames fan

'Gas outs' have been circulating on the internet for years.

They are infinitely naive plans that have zero effect on gas prices or gas companies.

I don't know if this is the case in Canada, but if you choose to boycott say....Exxon stations in the US it doesn't mean that Exxon isn't selling gas....the gas marketed at any particular Exxon station may or may not have been refined by that company.

As Sylvanfan said...if you want to do something to make the oil companies take notice stop driving. For most people, that's not a realistic option.

The concept that the marketing company probably did not produce or refine the product is not only true, the markting portion of the business chain is almost meaningless from a value standpoint. Basically the gas stations make enough to pay the bills and let the proprietor make about 30-50k.

The real value nowadays is in upgrading and refining. Alberta heavy producers as an example are seeing very wide discounts from WTI .... like 20 to 25 bucks US/bbl. The refinery buys at a discount and with scarce refining capacity sell at a premium.

[Flames in 07]

Originally Posted by SeeGeeWhy

Both, I wasn't looking at that sentence as two seperate statements.

I don't agree that people can be gouged on a luxury item such as gasoline. The price is going to be whatever people are willing to pay for it.

It is quite unreasonable of "you" (the complaining customer) to expect the merchant of such a product to not take as much profit as he can if the demand for the product is there just because his customer feels entitled to it.

People will complain about gas prices so long as they feel entitled to gasoline and that they have no other options.

True, but not only the sense of entitlement, but there isn't a hotel or airline on every street corner with their price in big numbers for everyone to see and compare.

I don't remember seeing a thread about the public outcry that hotel rooms tend to cost more during higher demand days.

[Flames in 07]

Originally Posted by Slava

"Refining capacity here really hasn't been boosted in the past 20 years... thats part of why the price of fuel doesn't mimic the price of crude oil."

And why would you increase the capacity? Even though the demand has obviously outgrown the production there is no onus on the oil industry to increase capacity; you just raise prices.

But it's a free market, so anyone can step in and build a refinery. The customers would like it, and frankly the producers would like it to. So why hasn't anyone?

For the longest time, it was an ugly business, there has been some growth lately in North American capacity (largely to recieve Canadian heavy sour) but even now the prospect of refining in the long run isn't that great. Despite what their margins, or cracks are on May 16th, 2007.

[Peanut]

Originally Posted by Kerplunk

Live in Temple, work in the industrial park by Chinook.

Then move.

If you want to change your lifestyle, you can.

[Dion]

Originally Posted by Cowboy89

That is a big barrier to entry that's for sure. The individual gas stations don't make any money on gasoline sales but rather slurpie, snacks, and all the other convience store items.

Plus those who run those stations are paid a management fee by the oil company.

[Ironhorse]

Originally Posted by Peanut

Then move.

If you want to change your lifestyle, you can.

That's a bit of a generalization, don't you think? Not everyone can move within "easy" reach of their work...

[Bring_Back_Shantz]

I love it when people complain about gas prices and say that they have no alternative to driving.

Temple to Chinook? What, are there no busses in Temple, or chinook? I doubt it.

What most people mean when they say things like "I have to drive to get to work" is "It's easier/quicker to drive to work".