It was a glorious summer for the giant of oil giants. Record prices for petroleum and so record prices at the pump unsurprisingly have retained ExxonMobil’s righteous crown as the most profitable company in the world: $14.8 billion in profit this past quarter.
According to the New York Times, Exxon has exceeded $10 billion in profit in nine of the last 12 quarters. Earlier this year, in the second quarter, the company posted a then-record profit. In the third quarter, Exxon reaped an increase of nearly 60 percent beyond that, setting yet another record while dropping its production by 8 percent for the quarter.
Royal Dutch Shell, Europe’s largest oil company, is celebrating a 22 percent jump to about $8.5 billion for the same quarter.
Our Energy Future: Foreign Oil/Domestic Oil — or What?
As the seemingly interminable political season winds down into the Nov. 4 election in just a few days, where we go with our energy policies is much in the air.
I don’t think leaders are talking about ending the use of oil. How could they? But one campaign (Obama-Biden) includes it as one piece of a diverse energy plan; the other sees the majority of our energy issue being resolved by answering one question: foreign or domestic? The McCain-Palin-Republican answer to that is to just drill the hell out of our domestic resources.
And today I gave brief pause to that idea for the first time. I thought, “Yeah, on of the important things we need to do is draw back from our thickly intertwined dependence on the Middle East’s resources, and all of the politics, war, etc. that it entails. If McCain were to wrangle the White House on Tuesday, we may go pedal to the metal in trashing our country’s natural resources, but at least we might free ourselves from the mess of the foreign politics that are so involved with Dubya Bush’s strategy.”
Of course, that was only a pause.
The strategy of putting all eggs into one basket — the oil basket — is still counter to common sense. Who invests their retirement all in one stock? What farmer relies only on one crop, no matter the circumstances, the needs, the market? What body builder builds only one part of his body?
In a way, aren’t we, as a nation, trying to rebuild our body? Shouldn’t we be trying to get our overall health in order?
So why would we keep exercising to build the might of the oil industry, ever-pumping ExxonMobil, for example, at the expense of the nation’s financial, emotional and physical health?
Alison Wiley
I agree that we need to rebuild our body as a nation. Exxon is getting richer and stronger as we are getting weaker and poorer due to our addiction to oil — with both problems feeding global warming. And I think many people DO want change. The following piece helps people slash their gasoline consumption while saving money: http://www.diamondcutlife.org/how-to-save-money-on-gas/
Bobby B.
Adam, it is good to see a post from you. It seems like it’s been a few weeks and I hope that all is well.
From the “eia.doe.gov/bookshelf/brochures/gasolinepricesprimer/”, we learn that “profits in 2007 were 10% of the gasoline price” for the oil companies themselves. During this same period, “Federal excise taxes were 18.4 cents per gallon and State excise taxes averaged 21.5 cents per gallon”. If we assume the same margins and an average at-the-pump price of $3.00/gallon for the last quarter, we can withdraw some interesting data.
If ExxonMobil earned $14.8 billion in profit, you can divide that directly by 30 cents per gallon to guesstimate the number of gallons sold to be about $49.3 billion. Multiply that quantity by the tax rates above, and you learn that the federal government received $9.1 billion and the states shared $10.6 billion; or a combined total of $19.7 billion in taxes. And remember, we are still only talking about one oil company. How much more do the federal and state governments profit when you consider how many more companies participate in this business? Not only do the central authorities make quite a profit, they do so without assuming any of the risks. They spend no monies on salaries, exploration, refining, marketing, etc. They just provide permission.
This government money grab – like all others – gets redistributed via pork barrel spending. Pork barrel spending in any representative’s or senator’s district is the most effective means of securing future votes (they literally buy them). Future votes result in the re-election of the old guard and the further entrenchment of their power. Do, do you honestly believe that it is in the interest of any politician to legislate mandates that negatively impact the energy business to any large degree? Which of them wants to risk his next term by losing the ability to bring home the bacon? Rather than begrudge the oil business its profits directly, would it not be more reasonable to work for congressional term limits on both the state and federal levels? If we could move people of principle in and out of office before they get addicted to money and power, our representative republic may return to doing the job as intended by the framers of The Constitution.
Karl
Enjoy it while it lasts… assholes.
jack cannon
The liberals love Enron because it cost the nation a lot money,,they hate the producers- Exxon Mobil, they pay same amount in federal taxes as the bottom 50% of U.S. taxpayers, both averaging 27 billion per year in taxes.
Keep praying at the alter of global warming and you will be cap and trade taxed to death.