American Truckers At War

Motivation behind global warming activism has never been about concern for the planet or life on Earth. Aside from using the evidence of a one degree rise in global temperatures over the past 100 years to promote global socialism (which was nothing more than recovery from a one degree drop in temperature over the previous century), there is another angle that should be considered, and if it’s the real reason for high gas prices today.

We hear all the time about oil company record profits from people who want to blame them for prices at the pump. The fact is that oil company record profits are a result of high gas prices, not the cause of them. Is an 8% profit margin on your product too much to ask? If an oil producer’s cost is $1.00 per gallon of gas, they sell it for $1.08 per gallon. Then the government adds on up to 65c tax before it goes to the pump. The oil producer makes 8c on that gallon, the real profit goes to the government.

Now consider, if the cost of crude oil doubles as it has recently, and say the refinery can produce a gallon of gas for $2.00, they sell it for $2.16. Still an 8% profit margin for the oil company. If their cost goes up again and now it costs them $3.00 to produce a gallon of gas, they sell it for $3.24 and still maintain their 8% profit margin but now they’re making 24c per gallon instead of 8c per gallon. As a result, their profits go up. The oil companies do not set the price for a barrel of crude oil. They are merely the buyers and the victims of OPEC. The oil company’s responsibility to the stockholders, the real owners, is to make a profit. Read more »