Gas Refiners Cut Production to Boost Margins

Billion$ just aren’t enough

Inebriated Press
April 10, 2008

Yahoo! Finance reported that gas prices are rising to new records again because gasoline supplies are falling, in part because producers are cutting back on output because their margins aren’t as big as they’ve grown used to. Analysts say gas prices will continue to rise no matter what the price of crude oil does and will probably hit $4.00 per gallon. Last spring refiners made around $37 a barrel and are making $11 to $12 profit now, and that’s not good enough.

“We got used to raping and pillaging last year and damn it felt good when the cash came in by the bushel basket full,” said oil executive Ghengis Khan, a feel-good kind of guy who never lets mercy or common decency get in the way of a good time. “We’ll get the money we want because we can. Hey, if Clinton could bang chicks in the Oval Office just because he could, we can do this. I learn from example man. It works for me. Tough shit if you’ve got stuff on your blue dress or you’re broke and can’t buy food. I’m getting mine. You’ve got to figure out how to get yours on your own.”

Not everyone thinks that the cavalier attitude that some in the oil industry display is good for America or the souls of the pillagers themselves. “I understand the need to pay the bills and profit, that’s the nature of capitalism and the American way. But when you have no competing fuels and a system controlled by the “haves” who can charge whatever they want of dependent “have nots,” that winds up being extortion and that’s wrong,” said Fairly Game, a trucking company executive who remains pretty level-headed despite being completely dependent upon others for the energy he needs to even turn one trucks wheel one revolution. “It’s sapping the economy more than the cost of defending America from terrorists and it’s going to harm our future and damn the oil magnates to hell. The souls of the oil guys are their own business, but we’ve got to save the economy of the country by getting these gas and diesel prices under control.”

The Yahoo! Finance article said that while oil’s surge above $100 over the last month has boosted gas prices so far this year, analysts now expect gas prices to continue rising regardless of what direction crude takes. The U.S. Energy Department expects prices to peak near $3.50 a gallon later in the spring, but many analysts predict the spike could approach $4. Analysts say that’s because gasoline supplies are falling, in part because producers are cutting back on output of fuel due to the high cost of crude – the more expensive crude is, the more refiners have to pay and the smaller their profits are.

The margin between the price refiners pay for crude and receive for selling the products they make from it is around $11 to $12 a barrel right now, according to the Oil Price Information Service. This is well below margins of $37 a barrel refiners earned last spring. The recent price spike is a sign the cutbacks may be working, giving everyone in the supply chain, from refiners to retailers, the ability to raise prices to boost margins. Still, the price hikes don’t worry all consumers.

“It doesn’t bother me a bit,” said Mafia hitman and part time government advisor Devious Vagrant, a former oil executive who wanted more flexibility in his day to day routine. “They’re shaking down people for cash the way any good business with power and influence on government does. Nobody pays the kind of money they do to officials and their campaigns without expecting them to look the other way when they use an occasional aggressive business tactic. The oil folks is jus’ doin’ good bidness. Forget about it.”

In related news, some Americans continue to pray for the souls of oil executives hoping that they can still turn from their ways and avoid damnation to hell. Others, usually standing next to their cars at service stations, are seen looking at the pumps and voicing clearly a desire that the oil providers spend eternity in the infernal regions. No word yet on how it will work out.

(C) 2008

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