Refiners pinched as gas price falls faster than oil

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JT Moderator	Message Posted: 11/23/2008 7:26:10 AM	Ignore JT Report Abuse
	Sunday, November 23, 2008 USA Today -- Crude oil prices tumbled below $50 Thursday for the first time since May 2005 as jobless claims hit a 16-year record and financial markets sank. But oil refiners, the chief buyers of crude, aren't celebrating. Gasoline prices are falling even harder and faster, so U.S. refiners are losing money on every gallon of gasoline they sell. Light sweet crude plunged 7% to $49.62 a barrel. Wholesale gasoline in the Gulf: $40.74 a barrel. Such topsy-turvy economics have happened on occasion for a few days. But the current pricing turnabout has lasted seven weeks and could persist a few more months, says Tom Kloza, chief oil analyst with the Oil Price Information Service. "It's unprecedented," Kloza says. Although refiners offset their gasoline losses with profits on diesel fuel, "if your feedstock costs more than your marquee product, you've got a problem." The average retail price of a gallon of regular gas fell 2.7 cents to $2.02 and OPIS expects it to dip below $2 Friday. Both crude oil and pump prices have plunged since July. But while crude is linked to a weak global energy market, wholesale gasoline has been hammered by a sharper drop in U.S. demand. Visit USA Today for full article

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rerosales Veteran Author Corpus Christi Posts:271 Points:226,600 Joined:Mar 2008	Message Posted: 11/24/2008 8:12:58 AM	Ignore rerosales Report Abuse
	Refiners will continue to lose money until the prices stop dropping.
markgocubs Sophomore Author Illinois Posts:180 Points:69,995 Joined:Oct 2008	Message Posted: 11/24/2008 8:11:44 AM	Ignore markgocubs Report Abuse
	I feel so bad for the oil refiners. I'm sure they made enough money in recent years to make up for the current market's "pinch".
greywolves Champion Author Las Vegas Posts:1,417 Points:980,525 Joined:Dec 2004	Message Posted: 11/24/2008 8:08:46 AM	Ignore greywolves Report Abuse
	this is one of the reasons why nobody has built a new refinery in the u s since the carter administration
2Chevy Champion Author Detroit Posts:3,046 Points:210,610 Joined:Aug 2005	Message Posted: 11/24/2008 8:07:52 AM	Ignore 2Chevy Report Abuse
	Interesting that the article makes an analogy with "if your feedstock costs more than your marquee product, you've got a problem." - how do they think the farmers felt when they were being raked over with the high cost of fuel in the first place, and then the added cost of fuel to their feed products they needed to supply their marquee product they made no money with? Most farmers are now operating at a loss this year because they had to pay the price like everyone else and they don't see the profit from the inflated price that showed up at the supermarket. Shame on the oil companies for feeling they should always make billions of dollars of profits at the expense of the little guy.
BIGJEFFSYR Rookie Author New York Posts:91 Points:35,945 Joined:Aug 2008	Message Posted: 11/24/2008 8:07:48 AM	Ignore BIGJEFFSYR Report Abuse
	OIL FAT CATS WILL ONLY MAKE MILLIONS NOT BILLIONS BOOHOO FOR THEM
rbdesigns All-Star Author Modesto Posts:502 Points:204,500 Joined:May 2008	Message Posted: 11/24/2008 8:07:25 AM	Ignore rbdesigns Report Abuse
	But when companies lose money they make cuts, usually in the form of layoffs.
CptnCanada Sophomore Author Saskatoon Posts:146 Points:48,950 Joined:Jun 2008	Message Posted: 11/24/2008 8:04:25 AM	Ignore CptnCanada Report Abuse
	BOOO HOOOOO they made record profits now they are giving some of that back. I feel soooo sorry for them.....NOT!!!!
spheremaker1 All-Star Author Arizona Posts:516 Points:398,465 Joined:May 2006	Message Posted: 11/24/2008 8:04:07 AM	Ignore spheremaker1 Report Abuse
	im guessing that most of the average people do not know that a refiner has to buy the crude oil up to a month before it gets to the refinery.. then the resulting product has to travel thru the system for a while before it gets to the marketing area.. once you buy the crude, your cost is locked in..
Matts_Pap Champion Author Pennsylvania Posts:1,523 Points:236,015 Joined:Feb 2008	Message Posted: 11/24/2008 8:02:46 AM	Ignore Matts_Pap Report Abuse
	They say the can't make money when crude is low and they couldn't make money when crude was high. Could they be fishing for a government (tax payer) bail out?
eagleeye2008 All-Star Author Wisconsin Posts:784 Points:157,565 Joined:Jul 2008	Message Posted: 11/24/2008 8:02:35 AM	Ignore eagleeye2008 Report Abuse
	THEY REALLY "NEED TO BE PINCHED" !!!!
Freshie Rookie Author Toronto Posts:78 Points:29,035 Joined:Jul 2005	Message Posted: 11/24/2008 8:01:08 AM	Ignore Freshie Report Abuse
	They were pretty quiet when the opposite was happening. The consumers need to catch a break some times. We'll all pay in the long run, but for now...TFB!
MajorSteve All-Star Author Oklahoma City Posts:727 Points:283,140 Joined:Sep 2006	Message Posted: 11/24/2008 8:00:46 AM	Ignore MajorSteve Report Abuse
	down to 1.51 here today!
cqgasguy Rookie Author Pennsylvania Posts:85 Points:38,150 Joined:Sep 2008	Message Posted: 11/24/2008 8:00:33 AM	Ignore cqgasguy Report Abuse
	This is how business should be. Sometimes you win....sometimes you lose. You just need to win more than you lose!!!!!
Biogen Veteran Author Ventura Posts:454 Points:108,480 Joined:Jul 2008	Message Posted: 11/24/2008 8:00:23 AM	Ignore Biogen Report Abuse
	More bigtime relief.
taco40 Champion Author Washington Posts:2,923 Points:505,075 Joined:Apr 2006	Message Posted: 11/24/2008 8:00:19 AM	Ignore taco40 Report Abuse
	Unfortunately, the refiners will get laid off and the owners will still reap profits on their backs.
DriverDave Champion Author Twin Cities Posts:6,757 Points:775,040 Joined:Jul 2004	Message Posted: 11/24/2008 8:00:16 AM	Ignore DriverDave Report Abuse
	"Exactly who is forcing them to sell below cost? " You like being able to drive, don't you?
Roysilver All-Star Author Orange County Posts:970 Points:325,005 Joined:Mar 2007	Message Posted: 11/24/2008 7:59:46 AM	Ignore Roysilver Report Abuse
	old news
rbdesigns All-Star Author Modesto Posts:502 Points:204,500 Joined:May 2008	Message Posted: 11/24/2008 7:59:45 AM	Ignore rbdesigns Report Abuse
	If it goes any lower it could start costing us jobs
Mooseman1 Champion Author Manitoba Posts:2,330 Points:356,405 Joined:Jul 2007	Message Posted: 11/24/2008 7:59:38 AM	Ignore Mooseman1 Report Abuse
	I don't think this article truly represents their situation. All of the bigs in both Canada and US have posted huge profits so far. In the greater scope of the rise and fall of crude, they are still way ahead!
dannyshouse Veteran Author San Francisco Posts:341 Points:205,130 Joined:Apr 2008	Message Posted: 11/24/2008 7:58:57 AM	Ignore dannyshouse Report Abuse
	pinch back!
Jamer All-Star Author Orange County Posts:920 Points:126,830 Joined:Jul 2002	Message Posted: 11/24/2008 7:58:46 AM	Ignore Jamer Report Abuse
	Same ol "cry me a river" song. Boo Hoo
MRHONEST Sophomore Author Illinois Posts:114 Points:385,815 Joined:May 2007	Message Posted: 11/24/2008 7:58:29 AM	Ignore MRHONEST Report Abuse
	"It's unprecedented," Kloza says. That's what they said when it went sky high! They are not losing money, just not making as much as they raked us for.
915Chief All-Star Author San Diego Posts:740 Points:143,920 Joined:Aug 2008	Message Posted: 11/24/2008 7:57:59 AM	Ignore 915Chief Report Abuse
	And????
oilgas Champion Author Pennsylvania Posts:1,796 Points:248,740 Joined:Dec 2007	Message Posted: 11/24/2008 7:57:47 AM	Ignore oilgas Report Abuse
	Ahhh
marinasgrandpa Rookie Author Atlanta Posts:99 Points:25,430 Joined:Oct 2008	Message Posted: 11/24/2008 7:56:50 AM	Ignore marinasgrandpa Report Abuse
	what, are we to feel sorry for these crooks?
mplato Champion Author Columbia Posts:1,517 Points:470,600 Joined:Jun 2004	Message Posted: 11/24/2008 7:55:18 AM	Ignore mplato Report Abuse
	old story
AnObserver Champion Author New Jersey Posts:1,819 Points:901,915 Joined:Sep 2005	Message Posted: 11/24/2008 7:55:12 AM	Ignore AnObserver Report Abuse
	Exactly who is forcing them to sell below cost?
Kthyme Champion Author Fort Worth Posts:2,951 Points:922,915 Joined:Apr 2006	Message Posted: 11/24/2008 7:53:14 AM	Ignore Kthyme Report Abuse
	There they go again...NOT tell the TRUTH!!!
stadlgi All-Star Author Akron Posts:971 Points:881,810 Joined:Jun 2004	Message Posted: 11/24/2008 7:52:25 AM	Ignore stadlgi Report Abuse
	Let it keep falling. I'm tired of being pinched.
Chargette Rookie Author California Posts:7 Points:15,990 Joined:May 2004	Message Posted: 11/24/2008 7:51:35 AM	Ignore Chargette Report Abuse
	It's their turn to feel the pinch!
jeepster23 Champion Author Massachusetts Posts:1,149 Points:353,105 Joined:Jan 2007	Message Posted: 11/24/2008 7:51:34 AM	Ignore jeepster23 Report Abuse
	aw
NoNoHugo Rookie Author Tennessee Posts:65 Points:55,575 Joined:Nov 2008	Message Posted: 11/24/2008 7:48:23 AM	Ignore NoNoHugo Report Abuse
	Ouch!
mattf373 All-Star Author Atlanta Posts:687 Points:133,340 Joined:Mar 2003	Message Posted: 11/24/2008 7:47:24 AM	Ignore mattf373 Report Abuse
	cry me a river
jake7497 All-Star Author Wisconsin Posts:700 Points:123,075 Joined:Aug 2008	Message Posted: 11/24/2008 7:47:08 AM	Ignore jake7497 Report Abuse
	oh well
rylank Sophomore Author Mississippi Posts:203 Points:45,165 Joined:Oct 2008	Message Posted: 11/24/2008 7:46:07 AM	Ignore rylank Report Abuse
	boo hoo
pwr2daprius Veteran Author El Paso Posts:315 Points:67,215 Joined:Oct 2008	Message Posted: 11/24/2008 7:45:17 AM	Ignore pwr2daprius Report Abuse
	yesterday's news
rtw777 Champion Author Florida Posts:1,178 Points:262,855 Joined:Jan 2008	Message Posted: 11/24/2008 7:44:32 AM	Ignore rtw777 Report Abuse
	They don't have a problem with lying.
21597 All-Star Author Colorado Posts:909 Points:255,040 Joined:Sep 2005	Message Posted: 11/24/2008 7:44:19 AM	Ignore 21597 Report Abuse
	We are not going to get the best end of this deal in the end. Our only solice is to cut use
CzechSteve Veteran Author Orange County Posts:480 Points:115,250 Joined:Jul 2008	Message Posted: 11/24/2008 7:44:19 AM	Ignore CzechSteve Report Abuse
	good for them. they can use the past profits to hold their head above water for a while.
ladyjj Champion Author Tennessee Posts:1,928 Points:206,110 Joined:Apr 2008	Message Posted: 11/24/2008 7:43:11 AM	Ignore ladyjj Report Abuse
	Yeah what about a rainy day fund! Oh man they made money! This is not going to kill them. we all paid dearly this summer!
Terryforegolf All-Star Author Lansing Posts:831 Points:371,825 Joined:Dec 2006	Message Posted: 11/24/2008 7:42:30 AM	Ignore Terryforegolf Report Abuse
	I agree 21597. Now alternatives will be put on the back burner.
radicale All-Star Author Calgary Posts:745 Points:195,825 Joined:Aug 2006	Message Posted: 11/24/2008 7:42:25 AM	Ignore radicale Report Abuse
	I don't know about that. They jack up the price faster when oil goes up, but seem to go awfully slow when oil goes down. Besides, I doubt they are actually dropping the cost of refining, only the cost of the base product. This should not affect them. Do they really know what they are talking about?
arvo87 All-Star Author New Mexico Posts:756 Points:156,800 Joined:Jul 2008	Message Posted: 11/24/2008 7:41:54 AM	Ignore arvo87 Report Abuse
	need new news
BigHops85 Rookie Author Iowa Posts:42 Points:47,220 Joined:Sep 2008	Message Posted: 11/24/2008 7:41:47 AM	Ignore BigHops85 Report Abuse
	OOOHHH, those poooooor refiners!!
glazarides All-Star Author Akron Posts:597 Points:380,215 Joined:Jul 2006	Message Posted: 11/24/2008 7:41:03 AM	Ignore glazarides Report Abuse
	Aw, I feel sorry for them, especially after they had record billions of profit of any company each quarter the last couple of years! (can you feel the sarcasm in that statement)
romatod Sophomore Author Vermont Posts:163 Points:54,500 Joined:Oct 2008	Message Posted: 11/24/2008 7:41:03 AM	Ignore romatod Report Abuse
	OLD NEWS ONCE AGAIN
SpyderDee All-Star Author Columbus Posts:637 Points:140,050 Joined:Jun 2007	Message Posted: 11/24/2008 7:40:30 AM	Ignore SpyderDee Report Abuse
	Did the refiners forget to put some money back for a rainy day?
DriverDave Champion Author Twin Cities Posts:6,757 Points:775,040 Joined:Jul 2004	Message Posted: 11/24/2008 7:39:57 AM	Ignore DriverDave Report Abuse
	"Refiners are OWNED by BIG OIL". Really? Last time I checked, the largest refiner in the US (Valero) was independent. In fact, even though gas prices were close to $3/gallon for a good chunk of the year, they only made $.17 per gallon in profit on gasoline. The crack spread is currently negative, meaning they lose money on each gallon of gas they make. Too bad so many ignorant jack***** are so quick to demonize the refiners when they make a dime per gallon or when they are losing money, it doesn't matter to them. Go direct your misplaced anger at the real problem - Yourselves.
spadilla Veteran Author San Antonio Posts:431 Points:86,115 Joined:Apr 2007	Message Posted: 11/24/2008 7:37:05 AM	Ignore spadilla Report Abuse
	I hope we're not headed back to the Carter days.
BoerneWatch Champion Author San Antonio Posts:6,725 Points:876,660 Joined:Oct 2005	Message Posted: 11/24/2008 7:36:24 AM	Ignore BoerneWatch Report Abuse
	The refiners are pointing to gas sales where their margins are lower but at least they have profit margins! The refiners are not pointing out that they have huge profit margins on diesel.

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