jdemaris said: (quoted from post at 14:49:50 02/28/08) You seem to be having a comprehension problem with that Wall Street article - I read it too, and I read it closely. It states Exxon's "production division" receipts were up 33% - NOT their profit margin. Total company profit margin was 10.4% and division profit margin was 14% - going by the Wall Street Journal article published Feb 1, 2008.
Is this the same Wall Street Journal you are citing?
JDEmaris, Exxon will always make around 10%. The difference between them and "normal" companies is that if the price of the raw material goes up, they just pass it on. You don't see GM raising the price of their vehicles by $3000 to cover the additional cost of steel do you? Back when oil was $30/barrel (assuming no other inputs), 10% would yield $3/barrel profit. If the price jumps to $100/barrel, then 10% would yield $10/barrel. Not a bad business model. Of course they have record profits, you would too if you worked on a "cost Plus" price setting function and people were required to buy your product.
The other complaint that people have is, yes, the cost is relatively unchanged from previous decades, the difference here is that gasoline prices have almost TRIPLED in 6 years!!! It was $1.33/gallon in 2001.
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