What factors contribute to gas prices? [OC]Submitted by USAFacts_Official t3_yl8yag in dataisbeautiful
amanamongbotss t1_iux5k6e wrote
It would be interesting to see the profit margins of each of these components, too.
AdvancedHat7630 t1_iux7z2a wrote
The level of adjustment for CPI is of interest, too. This isn't a very complete picture.
DM_me_ur_tacos t1_iuxf9od wrote
Exactly... How much of this trend is the CPI variability?
phdpeabody t1_iv0dfr8 wrote
Gas doesn’t get more expensive because of inflation. Gas getting more expensive is the cause of inflation.
drawkbox t1_iv10u6q wrote
Exactly.
Oil/gas is also the most damaging in increasing inflation because it affects the fulfillment of all goods across the board.
Oil/gas cartels have a massive lever on inflation they can use to extort the world, which they do on the regular and especially right now.
phdpeabody t1_iv5d8au wrote
There's no bigger oil/gas cartel than the US Government.
ThePandaRider t1_iv5hd6l wrote
Everything gets more expensive because of inflation. Inflation is a currency losing value, mostly because the money supply has been expanded. If there is more oil and the demand for oil stays the same the value of oil decreases, if there is less oil and the demand for oil stays the same the value of oil increases. The same thing happens with everything, including currencies. If the supply of dollar is drastically increased from $16trillion to $21trillion in a short timespan then the value of dollars relative to everything should drop. And it has started to drop, we just don't know where it will settle.
[deleted] t1_iv6zd1l wrote
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garlicroastedpotato t1_iuy5dor wrote
I know refining is incredibly small. They earn $0.05 per gallon of gas sold.
GranPino t1_iv0pc6c wrote
That would be a normal year. But when there is lack of refining capacity, the margin skyrocket.
drawkbox t1_iv113cx wrote
Oil/gas cartels work hard to control the amount of refineries down as well as take out leases they never utilize. Then they blame others and other factors for "lack of refinery capacity".
Smaller amount of refineries and fewer companies that control production of refineries that control those, keep the price of gas high or the margins tight, that is desired by the oil/gas cartels the most out of anyone.
685327592 t1_iux8urm wrote
The profit is mostly in producing crude oil.
wijenshjehebehfjj t1_iuxk3s5 wrote
Tell that to Valero, PSX, etc.
685327592 t1_iuxknyb wrote
Valero made 2.8B in profit last quarter.. Saudi Aramco made 173B
wijenshjehebehfjj t1_iuy2j6e wrote
Well yes, a petrostate will tend to make more money than a single refiner.
685327592 t1_iuy9yiy wrote
It's not just that they made more, Saudi Aramco's profit margins are absurd whereas Valeros are pedestrian.
InfiniteState t1_iuzloc2 wrote
That’s misleading because Saudi Aramco is cashing in on years of investing in extraction tech and infrastructure. That investment is why we’ve had cheap oil for the last 15 years.
They changed their thinking a few years ago and have decided, given the accelerated pace of the energy transition, to invest a lot less and take near term profits.
[deleted] t1_iuz0dqo wrote
Thanks to Biden for making the usa not a net exporter
ThisIsOurGoodTimes t1_iuyiaq1 wrote
PSX refining capacity is about 2mmbl/day or about 84 million gallons. Q3 earnings were $3.1 billion. So a very rough total margin per gallon on all products is about $0.40/gal. It’s much lower on that for fuel though
DeadFyre t1_iuycic3 wrote
Gas stations make a profit of between 3 and 7 cents per gallon. This chart illustrates Oil and Natural Gas profits against the S&P 500 for the past five years. What people don't seem to realize that the oil industry age shit through 2020. Now they're earning those losses back, is all.
[deleted] t1_iuzppad wrote
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LakeSun t1_iuxgyo0 wrote
...also, spot market pricing.
Where one Wall Street trade of one barrel, raises the price across the board for all.
It's like there are no long-term contracts. LOL.
sandee_eggo t1_iuzksu4 wrote
And what portion of inflation is gas prices?
And why are gas prices so low in the US compared to other countries?
amanamongbotss t1_iuzsrei wrote
I agree this should be adjusted for inflation, but the other thing is a different graph totally
sandee_eggo t1_iv0yo2w wrote
I had someone telling me irl yesterday that oil is a huge component/cause of inflation. While that makes common sense because we use oil to make and distribute so many products, oil prices are relatively low in America, and things like housing and health care make up a huge part of our household budgets. I mean, housing is like 30% of our budget.
amanamongbotss t1_iv142ro wrote
Oh this actually is adjusted for inflation.
But yea I believe oil does work it’s way into inflation pretty heavily, especially in public sentiment about it (gas prices are strong correlated with the sitting presidents approval rating- they’re almost identical).
I think inflation is also lower here in the US than many places abroad, and yea- while oil is a big chunk of that we have a lot of other things contributing too. Cost of wheat products for example. And I think the microchip shortage and other supply chain stuff as well…
Neither-Idea-9286 t1_iv1bqee wrote
Corporate profit should definitely be a contributing factor yet it’s no in there.
Mahameghabahana t1_iv4frxs wrote
Go for net profit then.
TinKicker t1_iv01sdh wrote
I’d say the profit margin for taxes is pretty much 100%.
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