(Photo credit: Jonathan McIntosh)

Chevron Corp. announced its 2013 first-quarter profits this morning. While income fell slightly compared to this time last year, the oil giant still earned a whopping $6.2 billion this quarter.

The company is also sitting on over $17 billion in cash reserves. How will Chevron spend its billions? Part of it is already being spent to rollback important public health initiatives.

Chevron is leading the lobbying and public relations effort to “undercut the California mandate aimed at curbing global warming, two years after the state phased it in.” Chevron is also making its shareholders and executives’ rich — buying back $1.25 billion of its stock, or 20 percent of its profit, and giving their Chair and CEO a $3.5 million cash bonus. The board also approved a $100,000 raise to their CEO, which boosted his salary to $1.8 million annually.

Below are some additional facts about Chevron:

• Chevron is ranked second of the Fortune 500’s most profitable companies, raking in an astounding $26.2 billion in 2012.
• The company spent nearly $4 million in federal campaign contributions during the 2012 election cycle, with 84% of its contributions to Republicans.
• Last year, the company spent $9.5 million on federal lobbying efforts and has already dropped $3.6 million so far this year.
• While Chevron may claim to pay its fair share in taxes, the company paid an effective tax rate of about 19 percent in 2011. This is almost half the 35 percent corporate tax rate standard as the company receives an average annual tax break of $700 million.

BP is the next of the Big Five oil companies to release their profits, which is expected next Tuesday, April 30th.

– Tiffany Germain is a Senior Climate/Energy Researcher in the Think Progress War Room.

While 2012 might not be a banner year for Big Oil profits, it wasn’t a bad one either. With just BP left to announce 2012 earnings, Big Oil earned well over $100 billion in profits last year, while the companies benefit from continued taxpayer subsidies. Average gas prices also hit a record high last year, showing how a drilling boom may help oil companies’ profit margins, but not consumers’ wallets.

ExxonMobil — now the most valuable company in the world, passing Apple — earned $45 billion profit in 2012, a 9 percent jump over 2011. Meanwhile, Chevron earned $26.2 billion for the year. In the final three months of the year, the companies earned $9.95 billion and $7.2 billion respectively.

Here are the highlights of how Exxon and Chevron spend their earnings:

ExxonMobil

Exxon received $600 million annual tax breaks. In 2011, Exxon paid just 13 percent in taxes. The company paid no taxes to the U.S. federal government in 2009, despite 45.2 billion record profits. It paid $15 billion in taxes, but none in federal income tax.

Exxon’s oil production was down 6 percent from 2011.

In fourth quarter, Exxon bought back $5.3 billion of its stock, which enriches the largest shareholders and executives of the company.

Exxon’s federal campaign contributions totaled $2.77 million for the 2012 cycle, sending 89 percent to Republicans.

The company spent $12.97 million lobbying in 2012 to protect low tax rates and block pollution controls and safeguards for public health.

Exxon CEO Rex Tillerson received $24.7 million total compensation.

Exxon is moving ahead with a project to develop the tar sands in Canada.

Chevron:

In October, Chevron made the single-largest corporate donation in history. Chevron dropped $2.5 million with the Congressional Leadership Fund super PAC to elect House Republicans.

The bulk of Chevron’s federal contributions came from the super PAC donation, for a total of $3.87 million for the 2012 cycle. 85 percent went to Republicans.

Chevron spent $9.55 million lobbying Congress in 2012, according to the Center for Responsive Politics.

Chevron paid 19 percent U.S. taxes last year (half of the top corporate tax rate of 35 percent), and received an estimated $700 million in annual tax breaks last year.

Chevron was fined $1 million for a refinery fire that sent 15,000 Richmond, California residents to the hospital. Though the company faces $10 million in medical expenses, Chevron earns it back in a couple of hours.

With Royal Dutch Shell and ConocoPhillips reporting $35 billion in combined profit in 2012, BP is the last company left to announce its profits for the year.

What does America’s second-largest oil company think about how to deal with global warming? Why, exploit more carbon-intensive resources, of course.

When questioned about the need to address global warming in an interview with the Associated Press, Chevron CEO John Watson said he believes the only path to global prosperity is more “oil, gas, and coal.”

Watson also said that it’s up to government leaders to find “a better solution for us” when dealing with emissions — not the companies responsible for emitting the carbon pollution heating the planet:

AP: Do fossil fuel producers bear the responsibility for curbing greenhouse gas emissions?

WATSON: We have the responsibility to deliver our energy in an environmentally sound fashion. The greatest advancements in living standards in recorded history have taken place in the modern hydrocarbon era. I don’t think that’s coincidental. Our leaders have to make a decision. Do they want that to continue or do they have a better solution for us? So it’s not my call.

AP: How should society go about reducing greenhouse gas emissions?

WATSON: If you look around the world, the countries with the best environmental practices are the wealthiest. There’s a reason for that. If you’re worried about where your next meal is going to come from or shelter over your head, your focus is on those things.

AP: The U.S. is a wealthy country, how should we reduce emissions?

WATSON: Well, we are a wealthy country. On the other hand, the economy is growing slowly. We have high unemployment. I think that’s part of the reason why the president said now is not the time for a carbon tax, because he recognized that that would put pressure on the economy and put pressure on our energy prices, put pressure on manufacturing business, put pressure on consumers.

AP: When it’s time to address the carbon issue, how should we do it?

WATSON: It’s very difficult for the United States to go it alone. Watch what (other) governments do. The day-to-day decisions being made (show) that concern about climate change is less than other concerns that they have. China is racing by the U.S. in greenhouse gas emissions. Germany is shutting down their nuclear power, the only energy source with zero carbon emissions that can be produced at scale. Japan, much the same way. Governments around the world are making the choice that the benefits of lifting people out of squalor are very important. And affordable energy is the way to get there. And that currently comes through oil, gas and coal.

Naturally, developing more fossil fuels is the solution according to Chevron, the eighth-largest oil company in the world. And developing climate solutions is apparently the responsibility of others.

The view from more impartial observers is remarkably different.

One of the world’s most respected energy institutions, the International Energy Agency, has warned that roughly two-thirds of the world’s carbon reserves must stay underground in order to prevent disastrous global warming.

Even the World Bank — historically a major financial backer of fossil fuel projects around the world — agrees that the world is on a path toward “extreme heat-waves, declining global food stocks, loss of ecosystems and biodiversity, and life-threatening sea level rise” without immediate decarbonization.

The accounting firm PricewaterhouseCooper estimates we would need to quadruple our rate of divestment from fossil fuels through 2050 in order to avoid such a grim warming scenario, warning “we have passed a critical threshold.”

That’s why environmental activists have rolled out a new fossil fuel divestment campaign in order to directly target companies like Chevron that are avoiding responsibility for climate change.

From: David Fenton

To: John Watson, CEO of Chevron

Dear Mr. Watson,

I’m the one who asked you about global warming at the Council on Foreign Relations last week. I accused you of being in denial. I’m afraid your answer proved it.

I pointed out that three recent reports warned we are headed for 4 to 6 degree centigrade warming over the next century — from those radicals at PricewaterhouseCoopers, The International Energy Agency and the World Bank. This is what your industry business model is threatening us with, a future that UK climate scientist Kevin Anderson has called “incompatible with an organized global community.” It will make coastlines unstable for generations as seas rise, bring the price of food beyond the reach of the world’s poor, create even stronger storms, droughts, wildfires and floods — all while wrecking the global economy. And it is happening now.

If you need a reminder, you can watch our exchange here.

Your answer? We have no choice but to keep burning all the fossil fuels to avoid returning to the Stone Age. China and India are doing it so we will too (sounds like what a five-year-old would say). There is no alternative technology, so we have no choice but to advance towards collective suicide. Such foresight and leadership!

But none of it is true.

What will return us to the Stone Age is burning all your reserves, and those of the other fossil fuel companies. That isn’t politics — its physics, as burning them will warm the earth beyond anything civilization has known.

Meanwhile, as the experts at McKinsey, the Rocky Mountain Institute and many others have shown, we can move towards an almost carbon-free energy system over the next 30 to 40 years at either zero net cost (McKinsey) or a $5 trillion dollar net present value savings to the economy (rmi.org). We have almost all the technologies needed, and as they scale they are coming down in price rapidly. Wind and solar are competitive in many places now, and soon won’t need subsidies (when will you give up yours?). With a smart grid, solar and wind can scale to at least 50% of our energy needs even before storage becomes more affordable, which it will. The new Tesla electric sedan gets 300 miles on a charge, and those prices will fall as volume rises too. Why isn’t Chevron leading us into this survivable and profitable world?

We can also save at least 40% of the energy we use just by making systems efficient, without sacrifice and with enormous savings, especially in buildings. This would end the recession and put millions to work. Why aren’t you leading this?

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By Jackie Weidman and Rebecca Leber

Chevron, the second largest oil company in the United States and eighth largest in the world, earned $5.3 billion in profits in the third-quarter of 2012. This brings their total profits for the first nine months of this year to $19 billion.

Last month, Chevron made the single-largest corporate donation since Citizens United. The company dropped $2.5 million with the Congressional Leadership Fund, a super PAC for House Republicans, after congressional GOP voted at least twice to protect Chevron’s $700 million tax breaks.

Below is a glimpse at what Chevron is spending its billions in profits:

– Chevron paid a 19 percent effective federal tax rate in 2011, after making $26.9 billion profit.

– Since 2011, Chevron has spent $16.6 million lobbying Congress to block pollution controls and safeguards for public health.

– Chevron spent $3.7 million on campaign contributions this election, with 85 percent of contributions going to Republicans.  Chevron gave more than any of the other Big Five Companies.

–Meanwhile, Chevron’s production has decreased by over 6 percent since this time last year, from 1.7 billion barrels of net liquids (oil + natural gas liquids) to a current rate of 1.68 billion barrels per day.

– Chevron is sitting on cash reserves totaling $21.3 billion, up from $15.8 billion in January.

– Chevron spent 24 percent of its Q3 profits buying back stocks ($1.25 billion), which enriches the largest shareholders.

– Chevron paid a 19 percent effective federal tax rate in 2011, well below the statutory corporate rate of 35 percent.

– Chevron CEO John Watson received over $17 million in compensation last year.

The Big Five companies are on track to make over $100 billion in profits this year, while they collect $2.4 billion in annual tax breaks. Meanwhile, they are producing 5 percent less oil than the third quarter last year. The Big Five has spent more than $100 million lobbying Congress since 2011, and millions on campaign contributions.

Chevron, the second-largest oil company in the U.S. and eighth-largest in the world, contributed $2.5 million in October to the Congressional Leadership Fund, a super PAC to elect House Republicans. That makes Chevron’s super PAC donation the single largest from a corporation.

The donation comes after House Republicans voted 109 times this Congress to enrich oil companies. According to Public Campaign Action Fund’s Adam Smith:

The donation appears to be the largest from a publicly-traded corporation in the post-Citizens United era. The corporate donation is double what the company’s PAC and employees have already donated to federal candidates and committees this cycle, according to analysis of data from the Center for Responsive Politics.

The company’s donation arrives in an election year where the oil industry has waged multimillion-dollar ad campaigns, including American Petroleum Institute’s campaign in swing states. Chevron has also sent 91 percent of its federal political contributions to Republican candidates. So far this year, fossil fuel groups have spent more than $153 million on campaign ads to promote pro-fossil fuel candidates.

Chevron gets a good return for its loyalty. House Republicans voted at least twice to protect Big Oil’s $2.4 billion in taxpayer subsidies. Chevron alone receives an estimated $700 million in annual tax breaks. And the company spent $16.6 million of Big Oil’s $105 million lobbying Congress to block pollution controls and safeguards for public health.

Starting tomorrow, the world’s largest oil companies — ExxonMobil, Shell, Chevron, BP, and ConocoPhillips — will begin to announce their third-quarter profits for 2012. In the first half of 2012, these companies — all ranked in the top 10 of Fortune 500 Global — earned over $60 billion.

The oil industry reinvests tens of millions of these dollars for political purposes, including nearly all political contributions to Republicans, lobbying, and campaign ads. Through its enormous spending, these five and other Big Oil companies have fought to maintain $4 billion of their annual subsidies, while seeking to undermine clean energy investments:

$105 Million On Lobbying Since 2011, 90 Percent Of Campaign Contributions To GOP: The big five companies have spent over $105 million on lobbying Congress since 2011, according to lobbying disclosures through the third quarter. The biggest spenders were Shell ($25.7 million), Exxon ($25.4 million), and ConocoPhillips ($22.9 million). The five companies’ oil PACs have donated over $2.16 million to mostly Republican candidates this election cycle. Koch Industries also spends big money to pressure Congress, with $16.2 million on lobbying and more than $1.3 million from its PAC (the top oil and gas spender). In total, the oil and gas industry sends 90 percent of its near $50 million in contributions to Republicans, far eclipsing their record spending in 2008.

Misinformation Campaigns, Including Over $150 Million In Election Ads:
Over $150 million has been spent on TV ads promoting fossil fuel interests, particularly oil and coal, reports the New York Times. In addition to traditional campaign donations, the oil industry has turned to outside groups running attack ads. Earlier this year, Americans For Prosperity — founded and funded by the Koch brothers — launched a bogus ad claiming that clean energy stimulus dollars went overseas. And the oil lobby American Petroleum Institute has its own campaign promoting myths about oil production and gas prices. For example, API chief Jack Gerard, rumored to be on Mitt Romney’s shortlist for a White House or agency appointment, claimed that oil production on federal land is down. This is simply not true, since oil production is up 240 million barrels on federal lands and waters under President Obama compared to the Bush administration. And oil companies hold 20 million acres of federal oil, gas leases in Gulf of Mexico that remain unexplored or undeveloped. This is just one of the many myths Big Oil has pushed this campaign cycle.

Behind-The-Scenes Campaign To Defeat Clean Energy: Koch Industries and fossil fuel groups are mobilizing to defeat the extension of modest tax incentives for wind energy, even though oil tax breaks are permanent. The American Energy Alliance, which has Koch ties, aims to make the credit “so toxic” for Republicans it would be “impossible for John Boehner to sit at a table with Harry Reid.” The Koch-funded Americans For Prosperity is also campaigning against wind energy. Meanwhile, the industry has argued its own century-old tax breaks are necessary to maintain, despite years of record-breaking profits.

Overall, these efforts to keep their tax breaks while weakening public health safeguards from pollution have paid off in Congress and for Republican candidates. The House of Representatives is the most anti-environment in Congressional history, averaging at least one anti-environment vote per day to eliminate or undermine pollution protections, many benefiting Big Oil. And the Romney/Ryan budget plan would give the big five oil companies another $2.3 billion annual tax cut beyond existing loopholes.

After the big five companies’ second quarter profits, ThinkProgress calculated what a typical 24 hours looks like for the oil industry:

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Every hour so far in 2012, the five largest oil corporations have recorded a $14,400,000 profit. And every hour, they received more than $270,000 in federal tax breaks. That adds up to $2.4 billion in subsidies every year for the five largest oil corporations — Royal Dutch Shell, ExxonMobil, Chevron, BP, and ConocoPhillips — all ranked as the top 9 companies in the world.

Even though BP posted an unexpected second-quarter loss, these five companies are on track to meet last year’s record profits. Put these numbers into context, and they are not so “disappointing“: Big Oil profits more in one minute than what 96 percent of American households earn in one year. Even so, Mitt Romney and House Republicans want to double what the five companies receive in federal tax breaks to $12.8 million per day, even though the three publicly owned U.S. companies paid an average tax rate of under 17 percent.

The graphic below illustrates where Big Oil directs these profits and its pollution over the course of a day:

¹ Center for American Progress, 7/30
² Center for American Progress, 7/31
³ EPA
⁴ Wall Street Journal
⁵ Open Secrets

The Big Five oil companies – BP, Chevron, ConocoPhillips, ExxonMobil and Shell – are slated to announce their 2012 second-quarter profits later this week.

We can expect these companies, all of which rank in the top 10 of the “Fortune 500 Global Ranking,” to reveal billions of dollars more in profits, after earning $375 million in profits per day in 2011 ($261,000 per minute), and $368 million per day in the first three-months of 2012 — bringing their combined profits to $1 trillion from 2001 through 2011.

Below is a quick look at just how much these Big Oil companies are making, and where they are spending their billions in profits.

Big Oil’s Big Profits, In 24 Hours

• The five biggest oil companies earned a combined profit of $375 million per day, or a record $137 billion profit for the year, in 2011, despite reducing their oil production.

• In 60 seconds, these five companies earned $261,000 — more than 96 percent of American households make in one year.

• These five oil companies received $6.6 million in federal tax breaks every day.

• In 2011, the three largest domestic public oil companies spent $100 million of their profits each day, or over 50 percent, buying back their own stock to enrich their board, senior managers, and largest share holders.

• The entire oil and gas industry spent on average $400,000 each day lobbying senators and representatives to weaken public health safeguards and keep big oil tax breaks, totaling nearly $150 million.

• Each CEO of the Big Five companies received an average of $60,110 in compensation per day last year. On average, their pay jumped 55 percent in 2011. Exxon CEO Rex Tillerson’s compensation came close to $100,000 per day last year.

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by Daniel J. Weiss and Rebecca Leber

Together the big five oil companies—BP, Chevron, ConocoPhillips, ExxonMobil, and Shell—earned a combined $33.5 billion, or $368 million per day, during the first quarter of 2012.

Recall that these companies made a combined record profit of $137 billion in 2011, mostly due to high oil and gasoline prices. Their ongoing huge earnings mean that these companies do not need $24 billion for a decade’s worth of tax breaks, particularly since the three American companies pay relatively low effective federal tax rates.

Profits for Chevron continued to grow during the first quarter of 2012 compared to this time last year, while they fell slightly for Shell and ConocoPhillips. ExxonMobil and BP saw a decline in first-quarter profits mainly due to reduced oil production (both) and very low natural gas prices (Exxon).

Cumulatively, profits were 7 percent lower than the first quarter of 2011. And more than one-quarter of these profits were used to repurchase companies’ stock. Meanwhile, CEO compensation grew by a whopping average of 55 percent.

Below we dig a little deeper into the big five’s latest earnings—including how they spent them—and explain why companies this profitable should not be receiving billions in tax breaks especially when this money could be spent on other national priorities.

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