Record profits: Big oil gorges while we suffer
It should not be a surprise to anyone that some big oil companies have reported record profits.
ExxonMobil’s profits for the third quarters jumped a whopping 75 percent from last year. That was a profit of $9.92 billion for the quarter. And that was a record for the entire oil industry.
Other big oil companies also did quite well, thank you. Royal Dutch Shell reported $9 billion in profits for the quarter. BP made $6.5 billion and ConocoPhillips enjoyed $3.8 billion. ConocoPhillips’ $3.8 billion might have been measly compared to some of the others, but it was a company record of 89 percent above the previous year.
How is it that “big oil” is enjoying record profits while the country, ostensibly, is suffering from an energy “crisis?”
Some members of Congress want some answers to that question.
Senator Majority Leader Bill Frist is asking for an explanation at hearings that began this week.
Meanwhile, House Speaker Dennis Hastert of Illinois says companies should be investing some of those profits in refineries and pipelines to increase production.
The industry apparently is loath to do so.
Explains Shell Oil’s President John Hofmeister: “A surplus of supply is not good for the industry.”
The explanation is that “demand and prices are prone to rise and fall” so there should be no rush to increase production, according to industry executives.
The real explanation could well be that oil companies see no need to spend money at the wells and on refineries when they are making record earnings with the status quo.
What about the burden exorbitant energy prices put on every individual, family, business, hospital and government in the country?
Big oil is grieving all the way to the bank.
Published in Editorials on November 2, 2005 11:09 AM