In 2023 Exxon-Mobil posted a profit of $36 billion. That's not revenue. That's profit. And yes, petroleum prices are a key driver of inflation.Originally Posted by Doug Garson
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In 2023 Exxon-Mobil posted a profit of $36 billion. That's not revenue. That's profit. And yes, petroleum prices are a key driver of inflation.
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Here's my take on it, not claiming to be an expert. What most of us are affected by, or at least notice the most, is cost of gasoline or diesel to fuel our vehicles or the vehicles that deliver goods to us. Gasoline prices are affected by the price of oil and also by supply & demand forces. There is a bit of a delima right now, as the O&G industries are, or are approaching, the status of a sunset industry. Demand for gasoline is still increasing but not forever and a lot of production facilities were cut back during the pandemic and I believe companies are hesitant to make large investments to increase production knowing they may not get a return on their investment as demand falls off in the not to distant future. This doesn't make them villains, they have a responsibility to their investors to maximize profits not responsibility to the public to keep prices down.
How we solve this is, as they say, beyond my pay grade.
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Operating? Net? ...you'd almost think CPAs are trying to confuse someone. My figure was based on this snap-shot...
Not sure why investopedia and yardeni only report with 2021 data? But interesting that O&G still falls short of GOOG. Darn.About 2.8%
A different online data set based on fiscal year 2020 accounting data calculates the average net profit margin for the oil and gas production and exploration sector at about 2.8%. The operating margin for oil and gas production was 44.4% in Q4 2021 and 23% for the full year, according to CSIMarket.
Average Profit Margin for Oil & Gas Drilling - Investopedia
www.investopedia.com/ask/answers/012015/what-average-profit-margin-compa…
And the inflation spike 'kinda happened' about the same time as Putin's brain fart. Or perhaps a look at OPEC+ actions at around that same time? Or perhaps driven by global pandemic recovery? And perhaps driven by 2019's shut-in and P&A of wells when you couldn't give O&G away? And perhaps driven by O&G industry having to up the rig count with the resulting lag in production recovery? And perhaps driven by a change in policy maker? I'll let you decide.
And then who could possibly expect record sales to generate record profits. My cutting board business is SO disappointed!
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They are villains in some ways. During recent lockdowns, demand for petroleum plummeted and so did petroleum prices. Of course, oil companies halted production big time and laid off many thousands. When demand started to increase, oil companies didn't increase production. They simply let high demand and low supply create a spike in prices. Then they sat back and reaped record profits while people tended to blame a certain politician for high gas prices.
As oil prices go higher, the incentive for alternate energy sources increases as well. So, US oil companies let the high prices ride for a while, THEN they slowly started to increase production until the US became the world's largest producer of petroleum.
US oil companies know the end of petroleum energy for most everything is coming. In fact, they are paradoxically investing in renewable energy while simultaneously spending tens of millions of dollars on misinformation campaigns. If you see people on TV telling us climate change is a hoax, those people invariably work for some "non-profit" funded by oil companies. If you see articles online or in print ridiculing the green energy industry, those articles were paid for by oil companies. If you see memes about how electric vehicles die in the cold and burst into flames, those were created and perpetuated by oil companies. (Sure, there is some truth to this, but oil companies exaggerate and perpetuate it while conveniently not mentioning that ICE vehicles also die in the cold and burst into flames.) Everyday people embrace all this misinformation and propaganda because they believe they are being deceived by an evil movement to destroy America. (At least that's what they tell me. And this is all very similar to tobacco companies creating and perpetuating information in the 70s and 80s about how there's no proof smoking causes cancer.)
Sure, OPEC is also a very big factor in global petroleum prices, but US oil companies can also push prices either way if they want; and they do.
Last edited by Pat Germain; 03-26-2024 at 4:14 PM.
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In my lifetime, nothing has ever gone down in price. I remember gas for 30 cents a gallon. I'm not sure what the point of this thread is.
Regards,
Tom
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^Yep. And they posted ~$1.5T in 2023 revenue. Or with my napkin math, 2.4% profit (yes, it is a bit off from the other cited sources). What are your acceptable margins?
Or with a quick look-back:
In 4th Qtr 2020 (9/1/2020>12/31/2020) Exxon-Mobil posted a loss of $36 billion. That's not revenue. That's loss.
It impacted 80,000 employees (now 70,000), 500,000 contractors (give or take 100,000-ish), and several million stockholders. A pity they are people too.
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Lest we forget...
Which led to $96.99B in "net income". And flipping the napkin over, 25.3% margins. Is that greedy?$383 billion
Apple, the world’s leading manufacturer of consumer electronics devices and the most profitable company in the United States, generated total revenues of $383 billion during fiscal year (FY) 2023, which spanned 12 months ending on September 30, 2023.
Apple Sales And Profits Analysis For FY 2023 — Top 10 Insights
www.forrester.com/blogs/apple-sales-and-profits-analysis-for-fy-2023-top-10-ins…
Last edited by Malcolm McLeod; 03-26-2024 at 6:02 PM.
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Is Big Oil evil? Run by the Devil himself? All 1.5M-ish US O&G workers are mindless automatons, not to mention the shareholders? Deluded by the clearly sustainable business model of destroying the planet and killing all of their customers? Or maybe they all just bought in?
Perhaps that propaganda boulevard is a 2-way street.
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ETA - Almost forgot this:
My company punched as many new holes in the ground as the BLM in NM would permit.They simply let high demand and low supply create a spike in prices.
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ETA2 - Since you edited as well:
I'm on the pointy end of this particular stick, and I'm afraid you would be wrong on this point. There has been nothing slow about the last 4 years. An oil well cannot be simply stopped and re-started at will. Once shut-in, many will never recover; they are plugged and abandoned. Others are P&A'd due to contractual issues (produce-it-or-lose-it, basically, and Uncle Sugar is the landowner). Some will require artificial lift - and all of the supporting infrastructure - to restore flow. And then consider that a given well's yield is ever-diminishing; you have to drill another one in another spot - and provide the infrastructure to collect its production ....if policy makers will issue the permit. BLM's back log of permit applications in Delaware Basin was 55,000 last time I heard. Policy, I guess....So, US oil companies let the high prices ride for a while, THEN they slowly started to increase production until the US became the world's largest producer of petroleum.
Come spend a day in the desert with me; happy to shed some light.
Last edited by Malcolm McLeod; 03-26-2024 at 7:00 PM.
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How about the computer you're using to access this forum?
Yoga class makes me feel like a total stud, mostly because I'm about as flexible as a 2x4.
"Design"? Possibly. "Intelligent"? Sure doesn't look like it from this angle.
We used to be hunter gatherers. Now we're shopper borrowers.
The three most important words in the English language: "Front Towards Enemy".
The world makes a lot more sense when you remember that Butthead was the smart one.
You can never be too rich, too thin, or have too much ammo.
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Slightly off topic, but this reminds me of Bomba Shack in Tortola. They wouldThe air was free. Use of the machine, well...
sell mushroom tea every full moon. Mushroom tea isn’t illegal, but it is illegal to sell it. They gave the tea away, but they charged for the cup. I never partook, but I did provide ferry service for friends that wanted to go.
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I'm really not sure what you're getting at. I used to live in Oklahoma and I knew a lot of oil field workers. No, I don't think they are evil. And I don't think oil company executives are evil, but as I said, they do tend to be villains. I don't pretend to have an intimate knowledge of oil well operations on teh ground, but I stand by everything I wrote. OPEC and US oil companies can and do decide how much oil they are going to produce. When I say "US Oil Companies", I'm talking about the big dogs and not the small companies.
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I work for a big dog. I know your 'villains' personally. Good people. Smart people. Damn smart. We are all proud to meet the world's energy needs. All 7B of 'em. Or is it 8B now? ...Is that 9B I see on the horizon?
Getting at: There was no 'slow walk'. Ever. We shut-in when there was no place left to stack the oil. It was crystal clear to management that the recovery was going to be a proverbial house-fire, so we spent >$1B in TX/NM in 1 year to recover; only the BLM, the time required to drill and move a rig, and exhaustion slowed us down.
Happy even to point out the small dogs who will do nearly anything to be big dogs. Including refusal to collude on production cuts.
Trust me, there are enough US small dogs to ensure the big dogs don't monopolize the market. OPEC has tried several times to drive these pups out of business: OPEC ups production which puts independents in a cash bind (high production costs>>low revenue>>no reserves>>bankrupt). Their only success in recent memory is BOPCO (~12-13yrs ago?). Most independents have gotten wise to the strategy.
Offer stands. Come see me. I'll drive you around and point at the facts; no need for internet links to biased interpretations and someone's propaganda. I'll even show you the drill rigs that 'policy' says aren't there. I'd really like for you to get it.
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Thank you for the offer, but I don't think the logistics will work out.
I'm not disagreeing with anything you posted above. But again, I stand by my statement: Big oil companies are villains for spending tens of millions of dollars over the past few decades to deliberately mislead people with exaggeration, misinformation and outright lies. I don't think this contradicts anything you have written. And, oh yeah, if you're in any room with oil company people, they are the smartest people in the room. I completely agree.
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Surprise, surprise. I tried.Thank you for the offer, but I don't think the logistics will work out.
...and yet this is where you started. So, I'll take this as a tiny win for reality.I'm not disagreeing with anything you posted above.
I left this one alone until now to keep from laughing.... villains for spending tens of millions of dollars over the past few decades to deliberately mislead people with exaggeration, misinformation and outright lies.
Good thing no one has done this to Big Oil. You know.... like there is no fracking exaggeration, no 300mpg technology suppression misinformation, no outright lies and fraud on groundwater contamination, no internet forum myths. And no one in PA has ever drilled a hole in a crude pipeline then reported the evil 'spill' to the EPA, all while they were on security cameras. ...Right?? Right. ROFLMAO
EVs? Gotta keep O&G prices up, but down just enough to discourage switch to EVs?
Imagine that! Competition! Really good thing this has never happened before. Right?
Except the same dilemma has existed since the Model T. Even the villains know it is in no ones best interest to keep prices high: prior to EVs, if gasoline prices got too high, people simply quit driving. Rode bikes. Soda sales plunged. Huge drag on the economy. Big Oil went broke. Then who would make gear oil for wind turbines, skins for solar cells, straws, fertilizer, Crocs, performance fabrics for The North Face, or elastic for my lacy delicates? Terrible horrible very bad no good. Best we not go there. Teehee.
Yep. A sundown industry. Enjoy. Out.
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no cell phone and only buy old cars and rust proof them. this one when it got tires its 21 years old guy said it was the most solid Saturn hes ever lifted. Lucky it was rust proofed before i got it by Krown but not well enough. Fortunately the mileage was pretty low so the most use is from me. If you want it done well you need to do it yourself and it takes time and is no fun. I do the truck each year and then dont drive it in the winter. Its 50 years old, the wally wagons the 92 is very solid rust proofed it from when I got it but its lots of time and product still I see cars like you talk about all the time rusted out which is pathetic really. I used to lose all my cars to rust and that stopped totally once I built a rig and did it myself. I built the rig and built the wands and go into all the holes and soak it. Just use Fluid Film. Lanolin stuff from Sheep. Wish my hoist was set up to power wash after the winter and start again as I have so much road build up in the rust proof like to remove it and start fresh.
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