How the oil industry saves $4.4 billion a year in taxes(edited)

[lpast]

Just more evidence of how big corporations and the rich shaft us and then whine they pay to much and then their cheerleaders all rush in to their defense.

Motorists are paying nearly $4 for a gallon of gasoline as the oil industry reaps pre-tax profits that could hit $200 billion this year.

This makes another big number hard to take: $4.4 billion. That's how much the industry saves every year through special tax breaks intended to promote domestic drilling.


How the oil industry saves $4.4 billion a year in taxes - USATODAY.com


I would love for someone to explain to me how the price of a barrel goes up and its understandable the price of gas goes up...but how do the oil companies reap far more profits when the usage goes down. So they sell less gallons of gas and reap HUGE profits...over and above whatever the cost of a barrel...what that is called gouging or robbery from a merciless corporation that has us all held hostage...we have no choice but buy their gasoline and heating oil...

 

[shintao]

Re: They want to give more Corporate tax cuts ???

Just more evidence of how big corporations and the rich shaft us and then whine they pay to much and then their cheerleaders all rush in to their defense.

Motorists are paying nearly $4 for a gallon of gasoline as the oil industry reaps pre-tax profits that could hit $200 billion this year.

This makes another big number hard to take: $4.4 billion. That's how much the industry saves every year through special tax breaks intended to promote domestic drilling.


How the oil industry saves $4.4 billion a year in taxes - USATODAY.com


I would love for someone to explain to me how the price of a barrel goes up and its understandable the price of gas goes up...but how do the oil companies reap far more profits when the usage goes down. So they sell less gallons of gas and reap HUGE profits...over and above whatever the cost of a barrel...what that is called gouging or robbery from a merciless corporation that has us all held hostage...we have no choice but buy their gasoline and heating oil...

We could have socialist National Oil with gasoline prices at around $1. a gallon, but then,..............socialism is a scary word & makes cons tremble in thier boots.

 

[donsutherland1]

I would love for someone to explain to me how the price of a barrel goes up and its understandable the price of gas goes up...but how do the oil companies reap far more profits when the usage goes down.

Demand is relatively (not completely) inelastic. Hence, consumption falls less than the price falls. For an illustration, assume that for every 1% increase in price, the quantity demanded falls 0.5%. In that hypothetical world, the quantity demanded at $3 per gallon is 1,000 gallons of gasoline per day. That would yield $3,000 in revenue. If a shock takes place and the price of gasoline rises to $3.60 per gallon (20% rise), the quantity demanded would fall 10% to 900 gallons per day. The new situation would yield daily revenue of $3,240 (an 8% increase). Let's say the price of gasoline rises 40% to $4.20 per gallon. Then, demand would decline 20% to 800 gallons per day. Daily revenue would increase to $3,360. That's the dynamic that is at play with crude oil and refined products on account of a relatively inelastic demand curve.

 

[tessaesque]

Couple of things:

1. Speculators and OPEC set oil prices.
2. These companies do more than just oil/gas refinement/mining/sales.
3. I imagine it's getting more difficult to drill these days, between the moritoriums held up in court and the banning of drilling in areas where the oil is more often the easiest to get to.

Not that I feel like they should be getting tax breaks. They definitely need to have all breaks and subsidies removed, or modify the system to encourge domestic drilling through another means (paid on completion of platfrom set-up and beginning of operation, perhaps?). After that is done I would say I really don't care what their profits are. Good on 'em for making money.

 

[apdst]

Just more evidence of how big corporations and the rich shaft us and then whine they pay to much and then their cheerleaders all rush in to their defense.

Motorists are paying nearly $4 for a gallon of gasoline as the oil industry reaps pre-tax profits that could hit $200 billion this year.

This makes another big number hard to take: $4.4 billion. That's how much the industry saves every year through special tax breaks intended to promote domestic drilling.


How the oil industry saves $4.4 billion a year in taxes - USATODAY.com


I would love for someone to explain to me how the price of a barrel goes up and its understandable the price of gas goes up...but how do the oil companies reap far more profits when the usage goes down. So they sell less gallons of gas and reap HUGE profits...over and above whatever the cost of a barrel...what that is called gouging or robbery from a merciless corporation that has us all held hostage...we have no choice but buy their gasoline and heating oil...

It's called profit margin.

 

[shintao]

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