Who makes more on a gallon of gas??

Parent Cafe
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<p>Exxon or the various levels of government that tax it? I’m betting on the government.</p>

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<p>yeah, exxons profits were so depleted from all them taxes</p>

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<p>yup, it’s the govt.</p>

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<p><a href=“http://www.taxfoundation.org/news/show/1054.html[/url]”>http://www.taxfoundation.org/news/show/1054.html&lt;/a&gt;&lt;/p&gt;

<p>The government makes about 13.3% on $3 gas. Exxon 9%.</p>

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<p>According to your link, the feds alone make 18.4 cents in taxes per $3 gallon, with the combined state/federal tax take (average) being 45.9 cents. The number I’ve seen for oil company profit is nowhere near 9% of $3, being more in the neighborhood of 5-8 cents per $3 gallon.</p>

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<p>That’s the overall profit on Exxon sales–I was being generous to avoid nitpicking.</p>

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<p>OK, Driver and Barrons, maybe the two of you can explain how Exxon can have net income of $9.92 billion on revenue of $100.7 billion with the meager profit margin you cite?</p>

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<p>That’s 9.85%. I said 9 which was based on the last complete year I had handy–2005. For the trailing 12 mos it was 9.7%. Still far less than the gov. cut.</p>

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<p>Kluge–you cite a less-than 10% <em>total</em> profit margin. I suspect that Exxon makes money on many other petroleum-related products besides gasoline. Asphalt. Plastics. Other stuff. <10% profit margin hardly sounds outrageous, for such an enterprise.</p>

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<p>Maybe someone can find out this number for me (I’ve tried): Exactly how much profit is made by an oil company (say Exxon) from a single gallon of gasoline. I would suspect that if you removed ALL profit, a gallon of gas would still be considered “too high.”</p>

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<p>My point, Driver, is this: you have internalized a set of numbers about oil company profitability which creates or reinforces certain attitudes and beliefs for you. I don’t doubt that you sincerely believed that Exxon made only “5-8 cents per $3 gallon.” My suggestion is that you consider being a little more critical about the assumptions you make regarding the poor beleaguered corporations you champion.</p>

<p>I’m no business basher, and I’m not suggesting that a 10% margin of profit per dollar of revenue is “outrageous” - although it is high for a commodity product company. What I’m pointing out is that you have been made to believe something that isn’t true, and you should spend some time thinking about why that is.</p>

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<p>wrong spot–ignore.</p>

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<p>

Kluge, since I’m so benighted, why don’t you enlighten me, since you, unlike me, have been more critical about the assumptions you make, and spend less time than I do believing something that isn’t true, and more time thinking about why that is. And you can read the below, from your home state energy commission, while you continue your ponderous pondering.</p>

<p><a href=“http://www.energy.ca.gov/gasoline/margins/[/url]”>http://www.energy.ca.gov/gasoline/margins/&lt;/a&gt;&lt;/p&gt;

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<p>"Maybe someone can find out this number for me (I’ve tried): Exactly how much profit is made by an oil company (say Exxon) from a single gallon of gasoline. I would suspect that if you removed ALL profit, a gallon of gas would still be considered “too high.”</p>

<p>Digi, a few organizations have attempted to track down the number you are seeking. I do not believe that the numbers of net profit versus taxes will be highly meaningful. The true cost of gasoline, for consumers and oil companies, is subject to a great number of elements that are not necessarily accounted for. For instance, indirect subsidies -or even the cost of our defense- are rarely accounted for in the externalities. </p>

<p>This said, you may find the information posted here interesting: </p>

<p><a href=“http://www.taxfoundation.org/blog/show/1140.html[/url]”>http://www.taxfoundation.org/blog/show/1140.html&lt;/a&gt;&lt;/p&gt;

<p>Between 1977 and 1985, the oil industry recorded relatively high profits—averaging nearly $33 billion per year, after adjusting for inflation. These good times were followed by ten years of relatively flat profits, averaging just $12.3 billion per year. In 1996, profits began to rise again but have been anything but stable, ranging from $9 billion to nearly $42 billion per year. Between 1977 and 2004, the industry’s domestic profits totaled $643 billion, after adjusting for inflation. </p>

<p>In contrast, federal and state taxes on gasoline production and imports have been climbing steadily since the late 1970s and now total roughly $58.4 billion. Due in part to substantial hikes in the federal gasoline excise tax in 1983, 1990, and 1993, annual tax revenues have continued to grow. **Since 1977, governments collected more than $1.34 trillion, after adjusting for inflation, in gasoline tax revenues—more than twice the amount of domestic profits earned by major U.S. oil companies during the same period. **</p>

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<p>An industry-wide study in the late 1990s showed that oil industry profits amounted to an estimated 7.3 cents on each gallon sold. </p>

<p>More recently, ConocoPhillips reported that during the third quarter of 2005 earnings from its U.S. refining and marketing operations amounted to 9 cents per gallon. This compares with a national average retail price of $2.60 per gallon during the third quarter, the period of highest gasoline prices in 2005</p>

<p><a href=“http://www.conocophillips.com/newsroom/other_resources/energyanswers/oil_profits.htm[/url]”>http://www.conocophillips.com/newsroom/other_resources/energyanswers/oil_profits.htm&lt;/a&gt;&lt;/p&gt;

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<p>Driver - thanks for the link. According to that website, “refinery cost and profits” went from $.30 per gallon to $1.06 per gallon between January and May. You figure that the cost of running refineries increased by 250% in four months?</p>

<p>Oh, and while comparing Exxon’s “cut” to the government’s “cut” - how much of that profit did Exxon spend on building and maintaining roads and provided the necessary associated services, without which Exxon would have little or no market to profit from?</p>

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<p><a href=“http://www.cbpp.org/9-8-05sfp.htm[/url]”>http://www.cbpp.org/9-8-05sfp.htm&lt;/a&gt;&lt;/p&gt;

<p>An intersting article. Not that anyone is claiming that the taxes are causing the rise.
Some states were considering dropping the taxes for a while in order to help out with the higher consumer costs, but decided against it because there was no assurance that the savings would be passed on to the consumer.</p>

<p>We need to research and produce alternative fuel. If some taxes would go for that purpose, I’d be all for it.</p>

<p>I do think it’s interesting that taxes are levied on a per-gallon basis, and do not increase with a price increase.</p>

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<p><a href=“http://www.energy.ca.gov/gasoline/margins/index.html[/url]”>http://www.energy.ca.gov/gasoline/margins/index.html&lt;/a&gt;&lt;/p&gt;

<p>this is interestings</p>

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<p>barrons - the 45 cent per gallon for taxes figure quoted by the site you posted is very different from the one the Department of Energy estimates — 45 cents versus 19 cents per gallon. They are measuring the same time period, I believe - last September.
I’m curious if they are measuring the same thing.
It’s an interesting discussion - I plan to learn more.</p>

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<p>In addition to Federal tax there are state and sometimes local taxes on gas. The states have been more aggressive in raising their taxes on gas.</p>