Steve Hargreaves, Senior Writer for
CNNMoney.com recently wrote an article titled:
"Why gas is so expensive, when oil isn't." In this article he makes reference to the price of oil in 2008 as compared to gas during that same year, and compares those numbers to those in place today. It's no surprise to most Americans that today's gas prices are coming awfully close to those in 2008 as we see prices rise almost daily. So, why does this article catch my eye? It wasn't so much the article Hargreaves wrote, as it was a quote he used from
Rayola Dougher, a senior economic advisor for the American Petroleum Institute.
Dougher was quoted as saying, "[Refiners] couldn't sell their product for as much as crude was increasing..." and, "people lost money," referring to those prices in place back in 2008. But saying, "People lost money?" Just who are these "people" she's referring to? If she's referring to the "refiners" as this quote implies, she's sadly mistaken. I think we, and especially Ms. Dougher, needs to take a closer look at the numbers.
According to Hargreaves in his January 30, 2009 article titled, "
Exxon 2008 profit: A record $45 billion" it's clear to see, or in this case read, that Exxon Corporation certainly wasn't one of the "people" that "lost money." Also, according to Garry White, writer for
The Telegraph, in his January 29, 2009 article titled, "
Shell profits hits record $31bn despite fall in oil price," Shell wasn't one of those "people" that "lost money" either. And lastly, an article posted on February 3, 2009 on
Monstersandcritics.com titled "
BP in 2008 profit jump despite sharp 4Q fall (Roundup)" BP saw their annual profits jump nearly 40 per cent to $25.6bn. So, just who are these "people" that "lost money?" I'm about to tell you.
In an article posted by Eric Leech on
Treehugger.com titled, "
2008 U.S. Gas Price Year in Review" Leech states that the gas prices reached an all-time high on July 7, 2008 with a national average of $4.11 per gallon. With three oil giants showing a total profit of $101.6bn in 2008, it's clear to me the "people" who "lost money" were the same people who couldn't afford to pay the $4.11 per gallon that these same oil giants profited from. The same people who don't own the yachts, private planes, and luxury cars that the oil execs often travel in. It's the average American who "lost money." The people who often worked for minimum wage which, according to the
U.S. Department of Labor, was a measly $5.85 until July 24, 2008 at which time it rose to $6.55 as seen
here.
In closing, I thank you Mr. Hargreaves for your incite and explanations as to why gas and oil prices differ. However, I recommend in the future that you be more thoughtful in who you quote. It is clear to me that Ms. Dougher cares only about the oil companies she works hand-in-hand with and not the average "people" on the street who "lost money" trying to get to their minimum wage paying jobs, or those currently unemployed like me, who just might take the time to read your articles. Sure, oil companies couldn't gain additional profits as the price of gasoline failed to rise as quickly as crude, but they still earned billions of dollars in profits. The same can't be said for the average American who had to make sacrifices to put gas in their car.
