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Thursday, July 24, 2014

Big Oil has its say

Posted Tuesday, April 1, 2008, at 11:39 AM

Excuses, excuses.

The oil industry just keeps pumping them out.

"Our earnings, though high in absolute terms, need to be viewed in the context of the scale and cyclical, long-term nature of our industry as well as the huge investment requirements," J.S. Simon, Exxon Mobil's senior vice president, told a House committee this morning.

Here's the lead parapgraph from the Associated Press story, and it says a lot:

"Top executives of the five biggest U.S. oil companies said Tuesday they know high fuel prices are hurting consumers, but deflected any blame and argued their profits -- $123 billion last year -- were in line with other industries."

I'd agree to a slight extent -- and only to a slight extent -- that Big Oil's costs rise like other industries. But that fades when you consider oil is a commodity which drives most of those other industries.

"Imposing punitive taxes on American energy companies, which already pay record taxes, will discourage the sustained investment needed to continue safeguarding U.S. energy security," Simon was quoted.

Well, imposing punitive prices on American energy consumers, which already pay record prices, will discourage the sustained investment needed in the U.S. economy.

Note that Simon used the scare word: "Security." An appeal to patriots, obviously.

I've noticed over the years that Big Oil backs down a little, and only for a while, if Congress puts on the pressure. Maybe we'll see oil prices level off for the summer. Maybe not.


Comments
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Did it explain more what they mean by cyclical nature? Did they show record losses that counter balance their record profits?

I don't mind being reasonable, but I do not remember any long term losses. They may be there and not reported, I just can not put my finger on any.

-- Posted by stevemills on Tue, Apr 1, 2008, at 12:17 PM

This is how I see it..If the price of gas goes up we all know that they will make a profit even if we stop going on those vacations we use to take when we could afford the gas. OK...If the price does not go up anymore or MAYBE come down some then everyone is going to start thinking about going on those vacations we have put off and everyone is going to start using more gas..So they will still make a profit. It is a can't lose scenario for them.

-- Posted by rebelrose on Tue, Apr 1, 2008, at 12:38 PM

If oil companies have spent so much money investing in new technology? Why haven't we seen it?

The fact is they have bought out several revolutionary products that could substantially reduce our foreign dependence on oil... If there were truly concerned about mpgs, a cleaner environment, and cheaper oil, perhpas they should allow some competition in the marketplace. Oil companies have a monopoly over the operations of their product. This is one case where having middle men would actually reduce the cost significantly.

-- Posted by darrick_04 on Tue, Apr 1, 2008, at 9:46 PM

Watched this dog & pony show on CNN and was not impressed with either side. all rehearsed.

-- Posted by bcar on Wed, Apr 2, 2008, at 9:23 AM

I mentioned something about this on another blog, but I was thinking (a dangerous thing for me) that the government made like $0.35/gal on gas and the oil companies profit something in the neighborhood of $0.15/gal. I will try to find out where I got those figures in the next day or so. Maybe someone else already knows (save me some work, lol) If thats the truth then we need to talk to the government first then move on to the oil companies. You know congress called the oil companies in to give them a good talking to, and we know the guilty dog barks first.

-- Posted by greasemonkey on Thu, Apr 3, 2008, at 12:50 AM


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David Melson is a copy editor and staff writer for the Times-Gazette.