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Re: E-M:/ Oil Indusrty Profits Soaring Through the Roof



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Enviro-Mich message from "William Tobler" <WilliamTobler@CrittersWoods.org>
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I believe price gouging  is the more probable explanation.  Here is the
basis for that opinion.

1) First of all, last year the big bubble in price increase occurred later
in the year, more like June and July.  If it was tied to switching over, I
would think that would be at the same time of year.
2) Last year, the industry execs were hauled before Congress to explain.  As
I remember, it was a sorry "Duhhh".
3) I don't believe that the laws of supply and demand are very effective
with regard to short term gasoline prices.  I don't have much discretionary
consumption for tomorrow or next week, even if they double or triple the
price.  If there were true shortages, then gasoline stations would be
closed.  Last year, that was only for a matter of hours, or never, and then
supposedly because of the pipeline break.
4) Reformulation supposedly costs only a few cents per gallon.  How does
this justify 40 to 60 cent increases that last for months?
5) I read today that the oil companies have huge increases in profits.
Don't get me wrong, I believe in capitalism, but I also believe in calling
the shots the way they are.
6) Isn't it interesting that 1 week after the Bush boys say that last year's
price bubble was artificial but not illegal, then we have another.


----- Original Message -----
From: "Rane Curl" <ranecurl@engin.umich.edu>
To: "Postings Enviro-mich" <enviro-mich@great-lakes.net>
Sent: Tuesday, April 24, 2001 2:59 PM
Subject: Re: E-M:/ Oil Indusrty Profits Soaring Through the Roof


> -------------------------------------------------------------------------
> Enviro-Mich message from Rane Curl <ranecurl@engin.umich.edu>
> -------------------------------------------------------------------------
>
> On Tue, 24 Apr 2001, Daniel Farough wrote:
>
> > A very interesting story for Michigan motorists who are concerned about
the
> > rising cost of a gallon of gas posted on the mlive webpage.  Exxon Mobil
> > reports its profits are up 44% for the first quarter of the year.  Yet
they
> > also admit that natural gas production is down only 1% and crude oil
> > production inched up 1%.  Can anyone say price gouging?
> ..snip...
>
> There are other factors involved, most important of which is the required
> switch-over from "winter" to "summer" formulated gasoline. This causes an
> interruption in supplies and could account for at least a temporary cost
> increase of the amount recently observed. This is an explanation that has
> been reported in newspaper accounts. However I cannot disprove the
> possibility of "price gouging" as another component.
>
> One thing that should really be done when these changes occur that raise
> public ire is that a full and verified explanation should be more widely
> distributed, through more thorough coverage. Of course, even then, the
> public might doubt the authenticity of the explanation and verification,
> which is a further problem to be solved.
>
> --Rane L. Curl
>
>
>
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