Now let's look a little closer at those figures:
- As of today, $134 is the cost of one barrel of crude oil.
- One barrel of crude oil constitutes 42 gallons.
- According to the California Energy Commission, one barrel of crude oil produces:
|Product||Percent of Total|
|Finished Motor Gasoline||51.4%|
|Distillate Fuel Oil||15.3%|
|Residual Fuel Oil||3.3%|
|Liquefied Refinery Gas||2.8%|
|Asphalt and Road Oil||1.7%|
|Other Refined Products||1.5%|
"The total volume of products made from crude oil based origins is 48.43 gallons on average - 6.43 gallons greater than the original 42 gallons of crude oil. This represents a "processing gain" due to the additional other petroleum products such as alkylates that are added to the refining process to create the final products."
The Oregon legislature mandated that all gasoline sold in Oregon must contain 10% ethanol, a non-petroleum-based additive (look at this as if it were Petroleum Helper - the fuel industry's version of Hamburger Helper), which increases the volume of finished motor gasoline from 21.59 gallons to 23.75 (rounded to nearest 2 decimal places). What is the cost per gallon of this bio-fuel additive? According to the state of Oregon "Because a gallon of ethanol contains less energy than a gallon of gasoline, the production cost of ethanol must be multiplied by a factor of 1.5 to make an energy-cost comparison with gasoline. This means that if ethanol costs $1.10 per gallon to produce, then the effective cost per gallon to equal the energy contained in a gallon of gasoline is $1.65." So, that 21.59 gallons of gasoline just jumped from a cost of $2.01p/g to $3.66p/g as it leaves the refinery, but at the same time, increased in volume by 2.16 gallons to 23.75g. I know this math-dance can be a bit confusing - hell, I'm confused by it - but for me it means that the real price gouging is going on inside OPEC. I gave up trying to find the wellhead production cost per gallon, or even per barrel ... those figures appear to be extremely well hidden. This is just a guess, but I wouldn't expect that the OPEC production cost would be more than 10% of the per barrel price. Keep in mind that there are also hidden transportation costs for the American Oil Cartel. So, where do they make those billions in profit? Let me refer you back to the California Energy Commission chart - 48.6% of crude oil imports goes for the creation of other-than-automobile fuels, and that's where the remainder of those outrageous profits are created. It appears that OPECs goal is to ruin western economies ... the same economies that gave them their oil production capabilities in the first place.
I'm Gil, and I approve this blog!