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ExxonMobil pumps its way to record profits while President Bush pumps up Big Oil

By Joe Romm  

"ExxonMobil pumps its way to record profits while President Bush pumps up Big Oil"

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Statement from Daniel J. Weiss, Director of Climate Policy and Senior Fellow, the Center for American Progress:

In 2007, ExxonMobil made a world record profit and all we got was $3 per gallon gas. High oil and gas prices have lined ExxonMobil’s pockets, courtesy of American families paying near record gas prices.

President Bush spent his presidency defending big oil, and it has paid off. In December, he killed tax incentives for wind and solar power, alternative fuels, energy efficiency, clean coal, and cleaner cars all to prevent the elimination of a measly $1 billion in annual big oil tax loopholes. In 2007, ExxonMobil and the other big four oil companies are likely to make a combined profit of at least $120 billion. President Bush’s defense of big oil is shameful.

The Big Five are BP, Chevron, ConocoPhillips, ExxonMobil, and Shell. The data for the figure can be found here.

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12 Responses to ExxonMobil pumps its way to record profits while President Bush pumps up Big Oil

  1. John Mashey says:

    The data for the figure can be found here.

    Broken URL.

  2. Joe says:

    Fixed — thanks!

  3. Sorghum Crow says:

    Peak profits = peak oil?

  4. Nick Kong says:

    RE: “Peak profits = peak oil?”

    They do go hand in hand, especially if you analyze what most are saying about supply lines this past year, high crude oil prices (both speculation and real) and how three of the big five just posted record numbers.

  5. John Mashey says:

    Well, given that demand continues to increase, as long as people can be inhibited from shifting to other technologies, there’s no reason that peak Oil mean peak profits, even as less oil is shipped.

  6. Jim Prall says:

    Great post Joe. I watched in horror as the energy bill went down to the wire and the Senate was ONE VOTE short of blocking the threatened filibuster from the oil-soaked climate denialist Sen. Inhofe. The same margin meant they would not have been able to override Bush’s oily veto.
    It’s one thing to say you are “against new taxes” but how many voters could possibly agree with Bush that we need to keep giving tax breaks to Exxon and we’d be ruined if any comparable tax incentives went to clean or renewable energy?
    Yeesh!
    Thanks for keeping this in the open. I hope the public gets the message and pushes their congresscritters to reject Bush’s position and get a national renewable electricity RPS through with enough votes to survive a veto.
    It’s particulary urgent to renew the wind power incentive, set to expire at the end of 2008. The U.S. set a record in 07 for new wind power installations, but the growth will be thrown into turmoil without a timely renewal in the first quarter. I heard there are already 70,000 jobs in the wind power industry!
    Too bad the wind industry doesn’t have tens of millions of excess profits to plow back into legalized bribery in our lovely system of lobbyists and enormous corporate funding of every candidate. How is this democrary, exactly?
    I’m encouraged to see Barack Obama speaking out against the lobbyist spindustry’s undue influence on our system of government.
    Do other countries have to deal with this huge an imbalance between huge corporate donations and lobbyists versus the common interest?
    I guess it’s easy to see I’ve been spending time lately enjoying the writings of Stauber and Rampton of the Center for Media and Democracy, http://www.prwatch.org
    I say it’s time to rise up against Exxon calling the shots in Congress and the White House. We need yet another round of campaign finance reform!

  7. james says:

    Nice way to leave out the important fact that oil is traded on an open market and the price is not under control of the big companies, but rather the people that produce oil (OPEC) and Hedge Fund managers who are using speculation to ratchet the price up beyond what supply and demand dictate. Individual Hedge Fund managers and traders have been making more than $1 billion each during the last few years.

  8. Joe says:

    I also left out that Bush’s failed Iraq policy and non-reconstruction has jacked up oil prices another $10 to $20 a barrel.

    But the bottom line is that Bush’s failure to adopt a sensible, patriotic energy strategy has left us vulnerable to hedge managers, terrorists, and dictators who don’t like us.

  9. Nick Kong says:

    James- are you kidding? Of course the big companies have the ability to control price! Much like OPEC, they are the suppliers of oil and have control over how to invest in their infrastructure. They recently bought back some of their stock as opposed to finding new oil rigs. Of course, we can say that peak oil is occurring and these oil companies are only gaining profits as a result. Either way, as Joe said, Bush isn’t exactly helping the situation out, but instead making us more reliant on oil instead of alt. energy.

  10. James says:

    Nick Kong, you should your ignorance in one small sentence. OPEC is the supplier, NOT the oil companies. The companies lease the privelage of pumping the oil. And what about the market exchange for commodities? Well, I guess that doesn’t exist in your fantasy world. These commodity markets and taxes are why refining is kept as a completely separate business. Joe is absolutely correct in that G.W. Bush is making the situation worse.

  11. Nick Kong says:

    Took me a bit, but I had to re-read your post and mine to see where we got off track. First off, apologies for coming off arrogant in regards to your post. I also would like to say that two wrongs don’t make a right and I’m offended at the tone in your previous rebuttal. James, I’m not sure what your background is, so forgive me if I oversimplify my response here (i.e. bore you).

    Regardless, I think you misunderstood my meaning. My contention with your first post is with the following line: “Oil is traded on an open market and the price is not under control of the big companies, but rather the people that produce oil (OPEC) and Hedge Fund managers who are using speculation to ratchet the price up beyond what supply and demand dictate.” Two reasons:

    1) Oil is under the control of the big companies, albeit somewhat indirectly (perhaps less so) than the speculators. So, when gas prices are high, profits are high (assuming cost per barrel stays constant… which, I believe it has been). What I was stating in my first post is how companies are not reinvesting that profit back toward capital expenditures, which would increase supplies and help to drive down price. Not investing also mean that speculators predict a shortfall of supply in the future and act to drive up price. So yes, you’re right on that account. However, just because I didn’t mention it, does not mean they are not important. Just as you didn’t think companies affect oil price and control supply, doesn’t mean they are not important as well. Then, the issue of peak oil (even instability in countries) pushes global supplies lower, which again, causes prices to go high especially with speculators’ involvement.

    2) OPEC is not the only producer of American or world oil. In fact, 40% of US oil comes domestically from companies like Exxon. Companies like Exxon also get their money from refining and other vertical processes. They only lease the privilege to pump the oil from the gov’t or private land owner. BUT, all the capital and infrastructure belong to the company.

    For your reference, here’s a list of global producers: http://tonto.eia.doe.gov/country/index.cfm. Note, not all of them are in OPEC.

    I am, however, glad we both agree that Joe is correct in his claims about Bush.

    For anyone else who wants to learn more how what determines the price of oil, you can visit: http://www.eia.doe.gov/pub/oil_gas/petroleum/analysis_publications/oil_market_basics/price_text.htm

    To end this post, I will say that bottom line is that we’re both partially correct. There are lots of factors that determine the final price of oil. BUT, it does not dispute the article that Joe posted regarding how big oil is profiting from higher gas prices and how Bush is helping them to do so. Yes, so are hedge funds, etc. (this was not noted in Dan Weiss’ comments because… that’s not the focus of his argument).

  12. Nick Kong says:

    http://tonto.eia.doe.gov/country/index.cfm

    I think I added an extra period in the first link I attached