Today's Headlines

Striving to be informative, timely and, at times, humorous can sometimes be more demanding than one might realize. Perhaps, even more so when its attempted on a regular basis such as Monday, Wednesday and Friday as I strive to publish my blog. Today's is simply a  random thought generated by today's headlines.

Around the world everyone is watching the disaster of our coast in the Gulf of Mexico. A little research revealed some interesting facts about a single barrel of crude oil.

A barrel of crude oil is 42 U.S. gallons and provides slightly more than 44 gallons of petroleum products. This gain from processing the crude oil is similar to what happens to popcorn which gets bigger after it is popped. The gain from processing is more than five percent.

One barrel of crude oil, when refined, produces about approximately 19 gallons of finished motor gasoline and 10 gallons of diesel fuel, as well as other petroleum products. The other products include: still gas, petroleum coke, liquefied refinery gas, asphalt and road oil, various oils for foodstocks, lubricants, special napthas, kerosene, waxes and an assortment of other miscellaneous products.

Yesterday the spot price for a gallon of crude was about $75. Figuring the price of gasoline and diesel at $3 a gallon, that adds up to $87. A guess, on my part, of some $50 to $75 for the remainder of its distillation products I come up with somewhere in the neighborhood of $135 to $160 per barrel retail sales prices. Unless my math is off, that is more than 100 percent of the selling price for crude. Granted there is the overhead to be figured but I doubt it comes close to 100 percent.

Just looking at the numbers and having a little knowledge of what a barrel of crude actually produces monetarily, I can see how the oil companies can post such huge profits. There is some speculation the current crisis with BP may force them out of business. As a thinking individual, it may put a small dent on their pocketbook but I don't believe it will force them into bankruptcy as may be the case with so many whose lives this disaster has shaken.