Since George Bush became President in 2001, the top five oil companies in the United States have recorded profits of $464 billion through the first quarter of 2007:
ExxonMobil: $158.5 billion
Shell: $108.5 billion
BP: $89.2 billion
ChevronTexaco: $60.9 billion
ConocoPhillips: $46.9 billion
Many industry analysts claim that rising demand in China and India are the big reasons why the price of oil exceeds $60 a barrel. However, they neglect to mention the role U.S. demand plays in setting global crude oil prices. Americans consume 25% of the world’s oil every day (see chart comparing global oil consumption). China, the next biggest consumer, uses less than 7% of the world’s oil each day. America’s huge appetite for oil combined with the fact that the United States is the world’s third largest producer of it (only Saudi Arabia and Russia produce more than we do) creates a strong argument that the United States holds a lot of sway over world oil prices.
The energy bill that President Bush signed in 2005 does nothing to address the U.S. factors that are driving oil and gas prices to record highs. Congress and the White House explicitly rejected efforts to improve fuel economy standards for our cars and trucks (which account for 60% of our oil consumption) or adequately fund fossil fuel alternatives.
The oil companies don’t mind. Since Bush became President, the largest five oil companies operating in the US - ExxonMobil, ChevronTexaco, ConocoPhillips, BP and Shell - have enjoyed profits of $464 billion, with ExxonMobil leading the way with profits of $158.5 billion.
Meanwhile, gas prices continue to go up up up - and no oil company is reinvesting their profits into the things that will benefit motorists. For example, in 2006 ExxonMobil spent $37.2 buying back its stock and paying dividends - at the same time, the company spent only $3.3 billion on capital investment in the U.S. So there is a direct correlation between record prices paid by consumers and record profits enjoyed by oil companies. As Americans shell out more dollars at the pump, the profit margin by U.S. oil refiners has shot up 158% since 1999 (the year Exxon and Mobil merged).
http://www.citizen.org/cmep/energy_enviro_nuclear/articles.cfm?ID=13912
And yes their total dollar profits are up. So are their expenses up. And the taxes they pay. And the dividends they pay their shareholders up. And the amount of investment they are pouring into exploration and capital investment have shot up the prices for material equipment and labor. Some drilling rig rates have tripled in less than 10 years. The demand for people in the industry hasn’t been seen for more than two decades. The oil industry is paying a lot of money to people willing to turn to this risky business.
And again, the question you keep avoiding to answer,
Is keeping 10¢ on the dollar out of line?
That line is completely FALSE. Yes, oil companies have to sell stock off when times are bad and buy stock back when times are good. They do it over and over in the boom and bust cycles to stay alive. When you look at the average over a long period of time, their profit margin remains around 8~10%.
Interesting turn of phrase, considering Exxon Mobil is an international company and spends money on projects worldwide. Much of the onshore drilling in the US is done by smaller companies.
Exxon Mobil and other 'majors' are the ones with the capital to invest in major offshore drilling projects--high dollar, high risk, high payout ventures--which just might not be here in the US, especially since government (Federal and state) has made most of the continental shelf of the US off limits.
As for investing in capital here, no one has been able to get a refinery built in 30 years, so where are they supposed to put the money?
FALSE™ @ 79.
Your ignorance is simply amazing and apalling at the same time. You are using Public Citizen as a source for your ‘facts’ on FR????? That’s Socialist front organization. It’s a political group disguised as a non-profit’ consumer advocate” group. I trust NOTHING they put out as facts, as they are consistently anti-capitalist.
First, 2 of the 5 are not US companies. BP is British and Shell is Dutch. Chevron dropped the Texaco name in a previous year.
ExxonMobil made $9.28 billion 1Q07, not $158.5 billion.
Exxon Mobil Corporation 1Q’07 Press Release
http://library.corporate-ir.net/library/11/115/115024/items/242049/1Q07_Earnings_Press_Release.pdf
Shell made $7.281 billion 1Q07, not $108.5 billion.
Royal Dutch Shell’s first quarter 2007 results
http://www.shell.com/home/content/investor-en/quarterlyresults/2007/q1/q1_2007_results_03052007.html
BP made $4.664 billion 1Q07, not $89.2 billion.
BP Group Results First Quarter 2007
http://www.bp.com/liveassets/bp_internet/globalbp/STAGING/global_assets/downloads/B/bp_first_quarter_2007_results.pdf
Chevron made $4.715 billion 1Q07, not $60.9 billion.
Chevron Reports First Quarter Net Income
http://investor.chevron.com/phoenix.zhtml?c=130102&p=irol-newsArticle&ID=992152&highlight=
ConocoPhillips made $3.546 billion 1Q07, not $46.9 billion.
ConocoPhillips Reports First-Quarter Net Income
http://www.conocophillips.com/newsroom/news_releases/2007+News+Releases/042507.htm
So the initial claim is overstated by 1,546%. Do you really expect people to take the rest as truth?