This thread really only applies to the actions of oil companies in America.
If the executives at the oil companies had some altruistic desire to help out consumers by cutting back their profits, is this something that they could legally do? Would this be a violation of their fiduciary duty to their shareholders? Would it be a violation of price fixing laws if multiple companies agreed to do this?
Really, they couldn’t do all that much. It’s a volume business; they don’t make that much profit per gallon, but they sell a LOT of gallons. I don’t know the exact figures–I’m sure someone will be along shortly with them–but it’s on the order of a few tens of cents per gallon profit, after the gas stations and distributors take their cut.
Sure, they could surrender of your profits (because most working people own them) and as a result prices would drop by 7 or 8 cents per gallon on paper (that is their profit margin). However, the people dispensing the fuel would probably nibble into that a bit. Let’s say you save 6 cents a gallon.
Hmmm…the taxes they pay might go down substantially (they pay one helluva lot) and well… someone would have to make up the difference.
Of course, many retirement accounts would drop in value, Wall Street would take a big hit and since the prices are lower, demand goes up. But without profits, the oil companies stop growing and struggle to meet current demand, probably layoff thousands and speculators would forecast even more oil shortages since the oil companies aren’t looking good.
Well, if they paid higher taxes then the price would go down at the pump.
It’s common sense.
Actually, the consumers pay all of their taxes. Think about it.
Edit: that’s gotta be a whoosh right there