Hilarious: New Mexico seeking exemption from Biden oil and gas leasing pause - governor

[J.mo + 165]

6 hours ago, ronwagn said:

I have been following the difference between wholesale gasoline prices and retail prices for many years. It is now about double what it normally is. $1.20 versus 60 cents per gallon pumped. That does not include delivery to the retailer. This is just blatant overcharging. So, we save up to  a dollar per gallon at Kroger. 

My figures are rough, someone else probably has better ones and additional factors to consider. Gasoline stations are almost all self serve, which has changed the cost of doing business as has the convenience store approach versus the high service expected in the old days, especially in the company owned stations. 

You guys are all very, very wrong. 
the Spot price is no where close for one to the delivered rack price. According to RBOB vs delivered, my price quote from 4pm today was 71 cents higher than what rbob lists. (When I say delivered, that is raw fuel cost, before taxes and fees.)
I have owned and operated a station for 10 years in California. 
Our retail margins blend in the store at 35%, so I’m not sure of the high margin anyone speaks of either. 
 

I think personally however, many owners leave money on the table in search of this unicorn they call volume. You can’t take volume to the bank, and making 180k a year in a $5m+ investment sounds foolish no? 
would anyone of you operate an everyday operation for a 3% cap rate? I didn’t think so. 

When gas is $2.50 out here, we can make more. Margins can expand, volume goes up, store sales go up, fees and operating costs go down. 
When fuel prices go up, well you guessed it. Margins go down, volume goes down, store sales go down. Fees and operating costs go up. But us as operators are supposed to cut margins further to appease the public. It’s a joke. 
you don’t think that making 5% on fuel is fair? How low would you go? What are your guys margins out there, let’s hear them. 
Guarantee they aren’t as low as the fat cat fueling retailers. 
 

 

oh ya, that 5% is before visa gets their hands on their 2%, because you know, you guys all need the credit card rewards right? 

Edited March 16, 2021 by J.mo

[ceo_energemsier + 1,818]

1 hour ago, J.mo said:

You guys are all very, very wrong. 
the Spot price is no where close for one to the delivered rack price. According to RBOB vs delivered, my price quote from 4pm today was 71 cents higher than what rbob lists. (When I say delivered, that is raw fuel cost, before taxes and fees.)
I have owned and operated a station for 10 years in California. 
Our retail margins blend in the store at 35%, so I’m not sure of the high margin anyone speaks of either. 
 

I think personally however, many owners leave money on the table in search of this unicorn they call volume. You can’t take volume to the bank, and making 180k a year in a $5m+ investment sounds foolish no? 
would anyone of you operate an everyday operation for a 3% cap rate? I didn’t think so. 

When gas is $2.50 out here, we can make more. Margins can expand, volume goes up, store sales go up, fees and operating costs go down. 
When fuel prices go up, well you guessed it. Margins go down, volume goes down, store sales go down. Fees and operating costs go up. But us as operators are supposed to cut margins further to appease the public. It’s a joke. 
you don’t think that making 5% on fuel is fair? How low would you go? What are your guys margins out there, let’s hear them. 
Guarantee they aren’t as low as the fat cat fueling retailers. 
 

 

oh ya, that 5% is before visa gets their hands on their 2%, because you know, you guys all need the credit card rewards right? 

In my posts, I have always stated that the margins for the fuel retailers is very slim, most  dont become millionaires from selling fuel!!!

[Ward Smith + 6,615]

8 hours ago, J.mo said:

You guys are all very, very wrong. 
the Spot price is no where close for one to the delivered rack price. According to RBOB vs delivered, my price quote from 4pm today was 71 cents higher than what rbob lists. (When I say delivered, that is raw fuel cost, before taxes and fees.)
I have owned and operated a station for 10 years in California. 
Our retail margins blend in the store at 35%, so I’m not sure of the high margin anyone speaks of either. 
 

I think personally however, many owners leave money on the table in search of this unicorn they call volume. You can’t take volume to the bank, and making 180k a year in a $5m+ investment sounds foolish no? 
would anyone of you operate an everyday operation for a 3% cap rate? I didn’t think so. 

When gas is $2.50 out here, we can make more. Margins can expand, volume goes up, store sales go up, fees and operating costs go down. 
When fuel prices go up, well you guessed it. Margins go down, volume goes down, store sales go down. Fees and operating costs go up. But us as operators are supposed to cut margins further to appease the public. It’s a joke. 
you don’t think that making 5% on fuel is fair? How low would you go? What are your guys margins out there, let’s hear them. 
Guarantee they aren’t as low as the fat cat fueling retailers. 
 

oh ya, that 5% is before visa gets their hands on their 2%, because you know, you guys all need the credit card rewards right? 

J.mo thanks for this post. What makes this site excellent are the observations and inputs from such a varied group. What @ceo_energemsier said applies too, getting into a buying group helps, and in my experience, switching banks got me a much better merchant fee. These guys look pretty good to cut down the interchange fee. The reason prices seem so high at gas stations is because grocery stores operate on thin margins also, typically 1-3%. How do they get so big? Turnover.

Back in 1984 we presented to Visa a device to read the chip that we were proposing to put in credit cards. We had a good proposal, they liked our tech, but they hated how small our company was (about $20 million). Way back then they were rolling through $800 billion a year, and expecting to double that volume within 2 years. Now it's well into the trillions, imagine collecting 2% of all that without lifting a finger? Notice how long it took for them to put chips in cards. 

[ronwagn + 6,290]

20 hours ago, J.mo said:

You guys are all very, very wrong. 
the Spot price is no where close for one to the delivered rack price. According to RBOB vs delivered, my price quote from 4pm today was 71 cents higher than what rbob lists. (When I say delivered, that is raw fuel cost, before taxes and fees.)
I have owned and operated a station for 10 years in California. 
Our retail margins blend in the store at 35%, so I’m not sure of the high margin anyone speaks of either. 
 

I think personally however, many owners leave money on the table in search of this unicorn they call volume. You can’t take volume to the bank, and making 180k a year in a $5m+ investment sounds foolish no? 
would anyone of you operate an everyday operation for a 3% cap rate? I didn’t think so. 

When gas is $2.50 out here, we can make more. Margins can expand, volume goes up, store sales go up, fees and operating costs go down. 
When fuel prices go up, well you guessed it. Margins go down, volume goes down, store sales go down. Fees and operating costs go up. But us as operators are supposed to cut margins further to appease the public. It’s a joke. 
you don’t think that making 5% on fuel is fair? How low would you go? What are your guys margins out there, let’s hear them. 
Guarantee they aren’t as low as the fat cat fueling retailers. 
 

 

oh ya, that 5% is before visa gets their hands on their 2%, because you know, you guys all need the credit card rewards right? 

Please explain how Kroger can pay up to $1.00 per gallon in discounts when they have normal supermarket profit margins. 

The last time I figured the margins was exactly a year ago. Here is what I came up with. The retail prices were much lower then. 

Gasoline Prices

 

http://www.gaspricewatch.com/web_gas_taxes.php

https://www.eia.gov/tools/faqs/faq.php?id=10&t=10

https://www.eia.gov/tools/faqs/faq.php?id=327&t=10

 Fed.               18.40 

Illinois           62.80 

Macon Co.      7.75

Total tax       88.95 

Gasoline wholesale price 64.4   3/20/20                               

Markup for transport and retail margin 60.0

 

Subtotal    $1.53.35

Transportation plus retail gross profit

5o to 60 cents

So look for a price of 

                   $2.13.35 to $2.23.35 (Usually .99 at the end)

 

Total $2.19 ( Ten cents to fifty cents lower than the current price without discount from Kroger) depending on how much you spend with them.

 

Kroger is $209.9 today without the discount. 

https://www.autoblog.com/62521-gas-prices/

 

[J.mo + 165]

3 hours ago, ronwagn said:

Please explain how Kroger can pay up to $1.00 per gallon in discounts when they have normal supermarket profit margins. 

The last time I figured the margins was exactly a year ago. Here is what I came up with. The retail prices were much lower then. 

Gasoline Prices

 

http://www.gaspricewatch.com/web_gas_taxes.php

https://www.eia.gov/tools/faqs/faq.php?id=10&t=10

https://www.eia.gov/tools/faqs/faq.php?id=327&t=10

 Fed.               18.40 

Illinois           62.80 

Macon Co.      7.75

Total tax       88.95 

Gasoline wholesale price 64.4   3/20/20                               

Markup for transport and retail margin 60.0

 

Subtotal    $1.53.35

Transportation plus retail gross profit

5o to 60 cents

So look for a price of 

                   $2.13.35 to $2.23.35 (Usually .99 at the end)

 

Total $2.19 ( Ten cents to fifty cents lower than the current price without discount from Kroger) depending on how much you spend with them.

 

Kroger is $209.9 today without the discount. 

https://www.autoblog.com/62521-gas-prices/

 

The same way Amazon subsidizes its retail business with AWS margins. 
supermarket NET margins are low, they have typical retail gross margins just like I do. They also have data that they drive and vendors that pay for space. They make money, millions and millions. They subsidize their gas with earnings from other avenues of the business. 
Trust me my man, no one, absolutely no one is making $1 per gallon. Especially in GEORGIA. 
 

and where exactly are you getting your wholesale cost from? An RBOB ticker? I told you already man, that is not even in the ballpark.

Here you go. Here’s an invoice from the other day. 
my retail price is $3.99. You can see most of, but not all of the taxes in this photo. 
add on another 9 cents for a credit card fee per gallon, add on quarterly taxes and sales tax. Quarterly taxes are an additional 3.5cpg and sales tax is roughly figured at 1.025% of retail. 
3.99 % 1.025 = 3.89

3.89 - .75 = 3.14

3.14 - .12 = 3.02

3.02 - 2.67 = .35 

if you don’t think that 35cpg is fair GROSS profit, you’re fooling yourself. This business has enormous regulatory and fixed overhead. If anyone wants a seminar, pull up a chair and I’d be glad. 
 

at the end of the year, I walk with about a 3% net cap rate. I know absolutely none of you, none. Operate a 3% net cap. Not even on a hands off Mail money business. 

Edited March 17, 2021 by J.mo

[J.mo + 165]

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Edited March 17, 2021 by J.mo

[ceo_energemsier + 1,818]

Dallas Fed: Biden regulations impact New Mexico worse than Texas in Permian Basin

 

https://www.thecentersquare.com/new_mexico/dallas-fed-biden-regulations-impact-new-mexico-worse-than-texas-in-permian-basin/article_86f658f8-86ae-11eb-b038-e3acb7886ab2.html

 

[Gerry Maddoux + 3,627]

The article is both right and wrong. The Delaware sub-basin is going to be pretty well exploited by the end of two years, when the moratorium kicks in. The hot spots are already permitted. 

The thing that will suffer most is re-fracking, which is likely going to turn into a very big deal in basins with super-rich source rock and multiple production levels. Especially when we start running out of oil. 

It seems likely that Mr. Biden has been used by the anti-fossil fuels movement. Switching to renewables is going to make such a tiny difference in climate change, but will make a few people on Wall Street enormously wealthy. 

[ceo_energemsier + 1,818]

Oil Groups React to Haaland Senate Confirmation

The American Petroleum Institute (API) has congratulated Debra Haaland after the senate voted to confirm her to lead the U.S. Department of the Interior.

“API congratulates Secretary Haaland on her historic confirmation and looks forward to working with the Department of Interior to shape the policies that will determine America’s energy future,” API President and Chief Executive Officer Mike Sommers said in an organization statement.

“As Secretary Haaland takes helm of a department that plays an important role in maintaining access to the nation’s vast energy resources, she faces clear choices. We can build on the significant environmental progress the nation has made while simultaneously leading the world in energy production, or we can return to the days of relying on energy from foreign nations with lower environmental standards,” he added.

“Secretary Haaland’s first priority should be to lift the federal leasing pause, which is creating significant uncertainty and undermining our nation’s energy security, economic growth, and environmental progress. We have a shared goal for a low-carbon future, but this is the wrong approach and will only lead to more foreign energy imports from countries hostile to American interests,” Sommers continued.

Commenting on the confirmation, Independent Petroleum Association of America (IPAA) President and Chief Executive Officer Barry Russell said, “we were pleased that in her confirmation hearings now-Secretary Haaland reiterated the importance of oil and natural gas and the multiple use mandate given to the Department of the Interior by Congress to manage the federal estate”.

“In the coming days and weeks as the department reaches President Biden’s 60-day freeze on leasing and permitting on federal lands, we hope Secretary Haaland and her team consider the perspectives of the independent oil and natural gas producers working and living in the communities where natural gas and oil production are the backbone of the economy, and the role they play in both providing energy for Americans and lowering our country’s environmental footprint,” Russell added.

National Ocean Industries Association (NOIA) President Erik Milito said, “NOIA is ready to work with Secretary Haaland and the Biden administration to advance America’s offshore energy sector”.

“Offshore energy is an American success story. In the Gulf of Mexico, offshore production provides the lowest carbon barrels of oil, generates millions of dollars in funding for parks and recreation programs for underprivileged urban communities, and supports hundreds of thousands of jobs across every state. Offshore wind is primed to soar, generating jobs and investment, and providing millions of Americans with access to renewable energy,” he added.

“But the Biden administration must deploy the right policies – including resuming Gulf of Mexico lease sales – to grow American energy, economic and environmental opportunities. Partnering with the women and men of the offshore industry will enable the Biden Administration to pursue an offshore energy agenda that truly helps every American,” Milito went on to say.

 

 

 

[ceo_energemsier + 1,818]

New Mexico breaks oil and gas production records in 2020 as COVID-19 challenges growth

 

https://www.currentargus.com/story/news/local/2021/03/30/new-mexico-breaks-oil-and-gas-production-records-2020/6972601002/