FTC investigating manipulation by oil companies

The FTC has opened a probe into the possible manipulation of gas prices by oil companies.

"The FTC letter notes federal data showing that as of early May, refiners’ margins — or the difference in value between their products and crude oil prices — had increased by more than 90 percent since the beginning of the year, yet refiners were using only about 82 percent of their capacity, a reduction from the same period last year."



“In light of these and other developments, the Commission has opened an investigation and has authorized the use of a compulsory process to determine whether certain oil producers, refiners, transporters, marketers, physical or financial traders, or others (1) have engaged or are engaging in practices that have lessened or may lessen competition — or have engaged in or are engaging in manipulation — in the production, refining, transport, distribution or wholesale supply of crude oil or petroleum products; or (2) have provided false or misleading information related to the wholesale price of crude oil or petroleum products to a federal department or agency.”


http://thehill.com/blogs/e2-wire/677-e2 ... nipulation

So who is forcing you to buy gasoline? You could always buy an electric, natural gas, or biodiesel rig. Especially since you seem to believe gas stations can charge any price they want to and people will pay it, right?

It's fishy the way the gas prices shot up and now have stayed pretty much in the same price range since then.

I do believe Americans will pay whatever price gas is selling for just to enjoy their vehicles. We're at the point now where $3.25 a gallon gas would seem like a bargain. It wasn't that long ago $2 a gallon gas was considered expensive.

I'm doing my part to drive less after George Bush asked Americans to decrease their fuel consumption by 20 percent. That was right after gas topped out at $4.11 a gallon.

I love the absence of relative facts from environmentalists hoping to disguise their agenda as news. What was the margin that went up by 90% recently? Was it half a penny a gallon and is now nearly a penny? Was it 50 cents and is now 95 cents? Why is the oil refining capacity down? Is it a result of aging equipment that is being updated to meet the latest round of Washington regulations? The regulations required a drop in sulfur in diesel from less than 500 ppm to under 50 ppm not too long ago. Perhaps some of the refineries have taken some of their capacity off line in order to make changes that will allow them to produce more fuel for domestic consumption instead of export to nations where the higher sulfur content is still allowed?

Lots of opinion in that piece aimed at starting baseless rumors and very few facts to support the headline. Which, when you get right down to it, isn't surprising from the regressive environmentalists.

Doesn't the fact the oil companies are making record profits tell you anything about what they're charging?

Not really, especially when the cost of their raw material has nearly doubled as well. A company that marks up a raw material 30% will make twice as much money when the cost of the raw material rises from $1 to $2 for the same quantity of the raw material and the same markup. Inflation is a mysterious thing, isn't it Wayne. When it costs twice as much to purchase something with a currency that is worth half as much as it used to be, why of course the physical number is going to go up along with it. That's just basic common sense, isn't it?

No matter what a corporation does.....no matter how much they may take advantage of the market and consumers, no matter how obscene their profits may be......even when they offshore as many of their jobs as they can....move their headquarters overseas to avoid US taxes.....whatever they do, how ever shabbily they treat the US consumer......the righties will still champion their cause. Talk about blind obediance to their corporate gods.

Attack the ideology with emotion rather than reason. I might make you feel better archer, but it doesn't alter reality as it exists. When a government monetizes their debt by artificially increasing the amount of its currency in circulation the inevitable result is an inflation in the price of goods. Economics 101 tells us that when you have more money chasing the same amount of goods, the price of the goods will rise. When the price of goods rise and the profit margin remains the same, what you get is a higher number of dollars in profit. The dollars may in fact purchase less than they did before the currency devaluation, but the number of them will still be higher. I'm sure the bakers in Germany were making record amounts of profits as well when it took a wheelbarrow of money to purchase a single loaf. Since the author of the opinion only cited the final figure, a reasoning person naturally questions why before jumping to the conclusion wished for by the writer of the opinion.

I post about what I read here....in the last couple weeks I have seen righties post that they don't much care how Walmart treats it's employees, or if small mom and pop stores fail in communities as long as they get their cheap Chinese goods......Walmart depends upon that greed and disdain for small business and low income employees to keep growing.......now I see where you don't much care if oil companies make ever growing profits at the expense of middle America.....


see a trend here? I do.

When you can demonstrate that those "ever growing profits at the expense of middle America" are different in nature from the ever growing profits of the baker in Weimar Germany were we can have a discussion along the lines you have drawn that has a foundation in reason rather than emotion archer. What you are accusing the oil companies of can be said equally about the grocers at the moment. The actual physical number of dollars in profit is going to rise when the profit margin remains the same and the cost of the goods is increased due to artificial inflation of the amount of currency in circulation.

When Obama was sworn in the cost of a barrel of Brent Crude Oil was somewhere around $47, it is now roughly $93. You are going to make a lot more money in profit at 30% of $97 than you were at 30% of $47 - to see this only requires a basic understanding of arithmetic. Pick your percentage, the results will be the same. The number will be about twice as large at $93 as it was at $47. So yes, the final number of profit dollars will have risen along with the price.

Show me that the "ever growing profits at the expense of middle America" is not due to this archer. I'm willing to be convinced if you actually have the facts to back up the accusation you are making.