Autoblog

US families spent an average of nearly $3,000 on fuel last year

Jeffrey N. Ross — Tue, 05 Feb 2013 13:31:00 EST

Filed under: Government/Legal, Earnings/Financials

Does it feel like more of your paycheck is going to pay to fuel up your vehicle? According to the US Energy Information Administration, it is. Last year, the average US household paid $2,912 for gasoline, which represents almost four percent of the average household annual income. The government agency notes that this is the highest percentage of household income spent on fuel in almost 30 years (save 2008, when the numbers were similar).

Oddly enough, US gas consumption fell to its lowest level since 2001, but gas prices have risen dramatically over the last couple of years to take a bigger bite out of our paychecks - 26.1 percent alone in 2011 and another 3.3 percent in 2012. Last year's 3.3 percent fuel price increase was slightly more than the 2.9 percent increase in household income. The one thing we can't blame this on is modern cars. Despite the fact the average US household's travel has increased "significantly" since the '80s, vehicles are now more efficient than ever.

US families spent an average of nearly $3,000 on fuel last year originally appeared on Autoblog on Tue, 05 Feb 2013 13:31:00 EST. Please see our terms for use of feeds.

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Why gas stations in NJ, PA are selling $8/gallon gas in protest

George Kennedy — Wed, 12 Sep 2012 13:31:00 EST

Filed under: UAW/Unions, Russia

Over 50 gas stations across New Jersey and Pennsylvania have raised the price of their fuel to more than eight dollars a gallon. They are all Lukoil stations, and their owners have raised prices in protest of practices by Lukoil North America that they say leave individual gas station owners at a competitive disadvantage.

According to a report by the Huffington Post (full disclosure: HP is also owned by Autoblog parent AOL), the protest is a response to the high prices that Lukoil apparently charges its franchise owners for fuel. The owners of the gas stations contend that they are paying more for delivery than what competing stations are charging to the public.

Sal Risalvato is a member of the New Jersey Gasoline, Convenience, Automotive Association, and is one of the owners frustrated with Lukoil. "They essentially sell the very same gasoline to stations in close proximity of each other at different prices in order to game the market and compete with other gasoline brands," says Risalvato. The result of this practice, he claims, is pricing that may differ by as much as 25 cents a gallon between a given Lukoil station and a nearby competitor. In a business where some people drive miles out of the way for the cheapest gas prices, the effects of that disparity can be massive.

Protesting Lukoil franchise owners have upped their gas prices to eight dollars a gallon and beyond to raise awareness for these practices. Lukoil, Russia's second-largest oil producer, first arrived in the U.S. in 2003. Today there are more than 500 stations throughout the Northeast and Mid-Atlantic regions.

Why gas stations in NJ, PA are selling $8/gallon gas in protest originally appeared on Autoblog on Wed, 12 Sep 2012 13:31:00 EST. Please see our terms for use of feeds.

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The U.S. is exporting oil products, so why is the price of gas still high?

Jonathon Ramsey — Thu, 07 Jun 2012 19:00:00 EST

Filed under: Etc., Government/Legal

It has always been the habit of the party that doesn't occupy the White House to blame various ills on the party that does. Especially in the past few years when it has come to gas prices, the party-in-waiting has blamed the POTUS for "pain at the pump." We're not taking sides here - Republicans are doing it to Obama now, just like Democrats did it to Bush. Unfortunately for their arguments, the President has about as much control over the price of oil as he does over the price of bread; if you saw what it took to get either to the retail outlet, the enormity of intricacies would make it plain.

Case in point: In 2008, the U.S. began exporting oil products like gas and diesel for the first time in decades and, according to a report in Fortune, even though the U.S. is producing more oil than any time in the past eight years, the price of gas is still high. Part of the issue is the bottleneck in transportation: Two pipelines carry the black gold to the nation's major clearinghouse for oil in Cushing, Oklahoma, where the president can be seen in the image above, and there aren't enough pipelines to get it from there to refiners. One analyst called Cushing "the 'Roach Motel' for crude" because it could get in but not really get out.

On top of this, domestic gas demand has dropped. That has added to the glut of oil awaiting shipment, which drove down the price of our own benchmark oil, West Texas Intermediate (WTI), by double digits compared to its European counterpart, Brent crude. Obviously, oil-market traders - whose contracts set the price for oil - couldn't let that continue, so they essentially walked away from WTI, a move that had the effect of setting the benchmark price at the higher Brent crude price. Put simply, they asked "Why sell a cheap commodity when I can sell the same commodity for more money?" And as we know, more expensive oil means more expensive gasoline.

That's the gist, but naturally this is a huge simplification. For instance, there are more than 100 kinds of oil traded on the markets and we've only mentioned two, and middlemen between drillers and the gas station can number in the dozens. But the point is that when you want to know what's up with gas prices, don't look at toward the White House - no matter who is in office - look at traders who will work to get the best prices they can, at refiners who can idle facilities to support prices and at the minutiae of production. The U.S. doesn't even own the oil drilled here - companies purchase drilling rights from the government and the oil they find belongs to them; they can sell it to anyone anywhere. Once they get it out of Cushing, that is. And if you think the much disputed Keystone Pipeline might help, some analysts believe it will make the price of oil rise.

The U.S. is exporting oil products, so why is the price of gas still high? originally appeared on Autoblog on Thu, 07 Jun 2012 19:00:00 EST. Please see our terms for use of feeds.

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Analyst suggests gas prices may have peaked at $3.92/gal

Chris Tutor — Wed, 11 Apr 2012 11:30:00 EST

Filed under: Etc., Earnings/Financials

High gas prices burning through your checking account faster than a Bugatti Veyron through premium? At least one analyst says the pressure might drop soon. Patrick DeHaan, senior analyst for gasbuddy.com thinks fuel prices have peaked for the year, with the national average sitting at $3.92 for the last week. According to USA Today, DeHaan expects average national gas price to fall to $3.70 before May.

If you're the type to send Thank You cards, keep in mind all those Toyota Prius owners who have sacrificed driving pleasure for greater fuel economy, and the leadership in Iran who have kept things kind of quiet over there for a few days. Depending on your political bent, you can also thank either the Democrats and/or Republicans for fostering a slow economy. All those elements contributed to lower oil prices and, in turn, lower gas prices. In contrast, the Federal Energy Administration is still predicting a $4.01/gal peak next month.

Either way, don't rush out and buy that gas-guzzling supercar just yet. Any number of factors could send fuel prices flaring. Meanwhile, enjoy your cheap, $3.92/gal regular while it lasts.

Analyst suggests gas prices may have peaked at $3.92/gal originally appeared on Autoblog on Wed, 11 Apr 2012 11:30:00 EST. Please see our terms for use of feeds.

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Gassed Up: Exxon Mobil posts record $45.2 billion profit in 2008

Jeremy Korzeniewski — Fri, 30 Jan 2009 12:29:00 EST

Filed under: Trends, Earnings/Financials

Another year, another record profit statement from Exxon Mobil, the world's largest publicly traded oil company. The specific mind-numbingly large figure is $45.2 billion, which translates to $8.69 per share. While this figure handily beats the previous record of $40.6 billion that had been set by Exxon Mobil in 2007, these huge profits were recorded mostly in the second and third quarters of 2008 when fuel prices were at record levels in much of the world. Fourth quarter earnings fell by 27%, though it's tough to feel too sorry for a company that still made $84.7 billion in the down economy.

Chevron, second only to Exxon Mobil in size, managed to post a $43 billion profit in 2008, but other smaller oil companies haven't been quite as successful in navigating the sinking global economy. Royal Dutch Shell, Europe's largest oil company, posted its first quarterly loss in a decade after seeing huge profits earlier in the year. The coming year should prove to be a similar challenge for each of the oil producing companies.

[Source: AP via Google | Photo by David McNew/Getty]

Gassed Up: Exxon Mobil posts record $45.2 billion profit in 2008 originally appeared on Autoblog on Fri, 30 Jan 2009 12:29:00 EST. Please see our terms for use of feeds.

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