Tuesday, May 29, 2012

God Bless The Oil Companies

When I was a boy, gas stations raised prices by a nickel for Memorial Day, then lowered the price after. My dad would moan and complain, curse the local Shell station, but keep driving. This of course made money for the oil companies, but it was bad PR.

When I was old enough to drive, the ploy was the same but the ante was up to a dime. I would moan and complain, but keep driving.

About seven years ago, the oil companies came up with a scheme that made record profits and had the driving public singing their praises. Rather than raise prices 10 cents a gallon for holidays, like they had done for years, they simply raised prices 90 cents, then s-l-o-w-l-y lowered the price per gallon by 50 cents so that by the 2005 long holiday weekend, gas was cheaper than it had been in months – but still 40 cents more per gallon – and we all drove rejoicing that gas was cheap for the holiday.

It was a win-win. Right? The good times have gone on nonstop ever since.

Three months ago, local gas prices jumped 50 cents over four days. The price has s-l-o-w-l-y dropped since then to where yesterday, Memorial Day, the price was down 25 cents. Hey, cheap gas.

I shouldn’t complain, because gas where I live is 15 cents cheaper than the national average, and U.S. drivers have paid less per gallon than most of the world for a long time.

But still.

What annoys me about the constant surge and slow retreat in gas prices is that the blame is deflected to unpleasant but largely noncausal factors. Blame the hurricanes for high gas prices. Blame Iraq. Blame the government. Blame Dan Brown.

Why not blame Exxon? The world’s largest oil company, Exxon, had “the fifth highest quarterly profit for any public company in history” in mid-2006 That’s not just their history, it’s all of history. In mid-2008, they "reported the largest quarterly profit in US history" - $14.83 billion. Remember, that’s not nearly $15 billion in revenue, that’s $15 billion in profit, after paying all expences, including hurricanes.

Meanwhile, as the cost of transportation rises, the cost of EVERYTHING else goes up and up and it doesn't come down. But I'm sure the economy is good at ExxonMobile.

Perhaps this is a simplistic view, but it is a pretty simple issue. The reason the scam works is because we keep driving. And rather than complain, we praise big oil and join them in blaming weather, war and government.
Try not to think about those $15,000,000,000 profits the next time you fill your tank.


  1. We are paying over 4 bucks a gallon for gas. And the state of California wants another tax hike on gas..........again. Yikes!

    1. Hi Kathy. I understand your pain. Kelly read this last night and did a search of gas stations in places she used to live in California. Most of them were about $1 more than we are paying here.

      Boy, it's something how Hurricane Katrina still haunts us, isn't it. Seven years later and the oil companies still have not recovered....

  2. Yet they are somehow making billions in profits. hmmmm.


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