There was an interesting story today on NPR about just this subject. Worth a few minutes to listen to the audio report and what the store owner has to say.

 

Gas Stations profit from more than just gas

Stossel points out things noone ever considers (except for HHSDad, who has been preaching this stuff for at least a year).

 

Wow, a major media story based on economics instead of hype and emotion. Go figure. This story merely summarizes what many of us already knew, but it IS nice to see it on television.

There was an interesting story today on NPR about just this subject. Worth a few minutes to listen to the audio report and what the store owner has to say.

 

Gas Stations profit from more than just gas

 

 

That story is 100% correct. I currently have 3 clients that own convenience stores/gas stations here in town. If it weren't for the retail goods inside the store, they would all be out of business. One good point noted in the article concerned credit card fees. As gas prices have increased, more people are paying with credit cards. Couple this with the fact that credit card fees have increased (as a % of the transaction) substantially over the past few years. After credit card fees are deducted from the purchase, there is VERY little if any profit left for the retailer. Also, drive offs have increased dramatically as prices have increased. Thus, if the retailer has one or two drive-offs a week (not uncommon), then that retailer could actually sustain a small weekly loss from fuel sales.

RM is right on the money, as is often the case.

 

Did Americans just start driving cars in 2002? Demand is some of it but certainly not all of it. This is the same as the Hurricane excuse a few years ago. Did Hurricanes start showing up in the early 2000's?

Did Americans just start driving cars in 2002? Demand is some of it but certainly not all of it. This is the same as the Hurricane excuse a few years ago. Did Hurricanes start showing up in the early 2000's?

 

Demand for oil is not just limited to American desires. I would guess that the biggest increases in demand would have to with the increased use of oil by other countries such as China.

Demand for oil is not just limited to American desires. I would guess that the biggest increases in demand would have to with the increased use of oil by other countries such as China.

True, but US consumption is up 3% and we use more than 10 times the amount of oil as the closest country.

Anyone know what the gas companies are investing their profits in?

An interesting article I found today:

 

http://money.cnn.com/2007/06/05/news/economy/refining_investments/index.htm?postversion=2007060517

 

Limited refinery capacity in the U.S. and no major player (oil company or deep-pocketed investor) will take the risk on building another one since they can't be sure gas prices will stay where they are. Congress is talking about raising Corporate Average Fuel Economy (CAFE) standards for cars and light trucks. Even GWB is now talking about reducing America's consumption of oil. With so much regulatory uncertainty, you'd have to be crazy to sink big bucks into a new refinery.

you mean like the roads and the safety vehicles that patrol those roads. I forgot that those were purchased with private funds.

 

Your missing my point. They have not "earned" the billions in taxes. They simply tax what others have found a market to sell. Leaching so to speak. Maybe I'm the only one that thinks this way.

 

What has government done to get gas into my tank?

Your missing my point. They have not "earned" the billions in taxes. They simply tax what others have found a market to sell. Leaching so to speak. Maybe I'm the only one that thinks this way.

 

What has government done to get gas into my tank?

 

Ohhhhh, please don't get Ace started . . .

An interesting article I found today:

 

http://money.cnn.com/2007/06/05/news/economy/refining_investments/index.htm?postversion=2007060517

 

Limited refinery capacity in the U.S. and no major player (oil company or deep-pocketed investor) will take the risk on building another one since they can't be sure gas prices will stay where they are. Congress is talking about raising Corporate Average Fuel Economy (CAFE) standards for cars and light trucks. Even GWB is now talking about reducing America's consumption of oil. With so much regulatory uncertainty, you'd have to be crazy to sink big bucks into a new refinery.

Careful, H. You're starting to sound awful greedy, there.

I can't watch the clip, but this is my $.02:

 

The greed that causes high gas prices is the greed of American consumers who refuse to lessen their demand. Americans need look no further than their mirrors to see who's responsible.

:thumb: I agree. Us Ross Perot supporters have to stick together.

I could fill up the 21 gallon tank on my LTD for $10. At 13 mpg, thats 3.7 cents per mile. Now 30 years later, I'm paying 11.4 cents per mile.

How much has inflation rose over the last 30 years that would account for that 68% increase in cost?

:thumb: I agree. Us Ross Perot supporters have to stick together.

 

 

 

For those of you saying "China's demand has increased", eg....What does that have to do with anything?

 

The point of the matter is this:

 

We are by far the biggest oil/energy hogs in the world. It doesn't matter what happens in the rest of the world if our demand is ever-increasing. We can't keep increasing our demand and blame it on another country's increased demand. We don't have sole proprietary rights to cheap fuel! Americans need to quit looking for someone to blame, and work to attack the root of the problem.....

 

To me, that's the most annoying thing about Americans as a whole. Everyone wants to find a solution for any issue that doesn't involve personal change or sacrifice. No one is willing to strip away the layers to take a harsh look at the real problems and take care of them, even if it hurts. Solving a problem ain't always fun. Most often, it hurts before we see the benefits.

 

For those of you saying "China's demand has increased", eg....What does that have to do with anything?

The point of the matter is this:

 

We are by far the biggest oil/energy hogs in the world. It doesn't matter what happens in the rest of the world if our demand is ever-increasing. We can't keep increasing our demand and blame it on another country's increased demand. We don't have sole proprietary rights to cheap fuel! Americans need to quit looking for someone to blame, and work to attack the root of the problem.....

 

To me, that's the most annoying thing about Americans as a whole. Everyone wants to find a solution for any issue that doesn't involve personal change or sacrifice. No one is willing to strip away the layers to take a harsh look at the real problems and take care of them, even if it hurts. Solving a problem ain't always fun. Most often, it hurts before we see the benefits.

 

If you subscribe to the laws of supply and demand and the resulting price fluctuations based on those laws, then China's increased demand has a LOT to do with the increase in the price of oil and therefore gasoline.

 

I agree with the rest of your post (if that's any consolation )