If I'm a gas company and I buy oil and make it gas, how do I benefit from an increase in the price of oil?

Sometimes thinking caps are really cool and fun - try one today!If I'm a gas company and I buy oil and make it gas, how do I benefit from an increase in the price of oil?
90% of the time “gas companies” are ';oil companies'; - so it's a win - win kinda thing. Buy from a subsidiary at a profit to that part of YOUR Company and write the cost off - produce gas at an artificially inflated price and reap the rewords.





http://finance.google.com/finance?q=NYSE…





You’ll get the idea when you look at the 10 Y chart at the link above.If I'm a gas company and I buy oil and make it gas, how do I benefit from an increase in the price of oil?
Gas companies do not exist. They are oil companies. The oil they find and retrieve is used to create many things including gasoline.
Your inventory also increases in value.
Because the market will buy your current supply that you paid less for at the current price. It's how the futures market works. Works the same for corn, soy beans, and whatever.
if you're like the thieving oil companies - you raise th price of gas before the increased cost oil is even purchased, so you make more money off less costly oil that was used to make the actual gasoline
If you are a gas company who purchases oil you do not benefit unless you increase your price to offset the increase. however if you are a gas company who also produces your own oil then you are making billions in profits from inflated prices.
Well the gas company is probably the oil company and they dont have to buy the oil as they will produce it through drilling and refinning. So then when they do sell crude as well they sell it for more money
you pass the increase to the consumer and you usaully increase the price for all the old oil you obtained at the lower price, so your profit margin increases.
Because if I'm paying say about a dollar a gallon for oil, and the news says that the price was raised, I can sell it for three dollars a gallon and nobody yells at me about inflation.
Because the oil you bought is worth more than you paid. If I buy an iPhone for $400 but the market says it's worth $800, I'll make a nice profit by selling it.


Gas companies will simply pass the higher cost along to consumers anyway.
Raises tax revenues for the government .


30% of a dollar is just 30 cents .


30% of $3.00 is .90 cents .


you do the math . Plus businesses run on percentages also and the higher prices go the greater the profits become . So instead of a 10 billion dollar profit that number becomes 20-30-40 billion depending on how high the price gets .
You mean gasoline? The refineries are mostly owned by large oil companies that are vertically integrated all the way down to the retail store you buy your fuel from these days. They drill for it, pump it out of ground, clean it up, refine it, and then they sell it.





There are very few independent refineries (that's who produces ';gas';, my ';thinking'; friend).
high oil prices=more people switch to gas=higher gas prices.





We're getting screwed..
(i) look into possibility of using other alternatives as your raw material, a very good one is using palm oil. palm oil can be turned into fuel and even for cooking





(ii) try to minimize the residue of your processes





(iii) pass the increase of the cost to end-users by hiking up the price of your gas