Top Oil Execs to Congress on Their Record $123 Billion Profits: ‘We feel your pain, but don’t blame us!’
Ten days after US military deaths in Iraq reached 4,000, the top executives of the five largest oil and gas companies appeared before Congress. It was Tuesday, April 1st – April Fools’ Day – and they were there to address the record profits their companies were bringing in and why the companies should continue to receive billions in government subsidies by way of tax breaks. The top honchos were from Exxon, Shell, BP America Inc., Chevron Corp. and ConocoPhillips, and were appearing before the Select Committee on Energy Independence and Global Warming. The execs told Congress that they know record fuel prices are hurting the American people, and claimed it’s not their fault and said their huge profits are in line with other industries.
Combined, the oil companies made $123 billion last year. This is at a time when US motorists are paying record prices at the pump – now averaging $3.29 a gallon amid talk of $4 a gallon this summer. The price of oil has settled at just over $100 a barrel on the New York exchange. And one out of 8 Americans are on food stamps. Then there’s the mortgage crisis, the housing crisis, … not to mention the Constitutional crisis. And recent economic experts have tied the huge costs of the Iraq and Afghanistan wars to bringing down the American economy, and there’s even talk that we’re heading into not just a recession but a massive depression …. we could go on.
Record profits by the oil companies. Even Alan Greenspan had to admit that the reason we’re in Iraq is because of the oil.
4,000 US Deaths to Secure Iraq Oil Fields for Oil Companies
So, let me get this straight. Our economy is going down the toilet while the hike in gas prices drives all our consumer goods – like food – up. The Iraq war is taking away our financial resources while we’re in Iraq to secure the oil fields for the oil companies. And the oil companies are making record profits off of us. My god, no wonder we elected Bush twice! We’re dumber than a bag of hammers.
But wait – our countrywomen and men are dying to secure those oil fields! Our people! 4,000 and counting. They died for the oil executives who testified in front of our Congress and said, hey, we feel your pain, but don’t blame us, we’re just making money like everybody else. That’s what they said.
Oil Company Profits Higher Than Other Industries
The Associated Press reported that the execs said their earnings are typical and in line with the average of other major US industries. AP outlined the combined 2007 earnings and revenues of five top companies in some major industries:
The oil and gas industry earned $123.29 billion on revenue of $1,460.20 billion. Companies included are Exxon Mobil Corp., Royal Dutch Shell, BP PLC, Chevron Corp. and ConocoPhillips.
The pharmaceutical industry earned $48.24 billion on revenue of $230.64 billion. Companies included are Johnson & Johnson, Pfizer Inc., GlaxoSmithKline PLC, Sanofi-Aventis SA and Novartis AG.
The defense industry earned $15.5 billion on revenue of $229.59 billion. Companies included are Boeing Co., United Technologies Corp., Lockheed Martin Co., Honeywell International Inc. and Northrop Grumman Corp.
In their report, the Associated Press differs with our perspective, as the mainstream media group concluded: “Oil and gas industry earnings appear to be in line with financial performance of others.”
President of Shell: “I heard … Americans are very worried about the rising price of energy.” – April Fools!!!
The Big Oil execs were in front of Congress on – yes – April Fools’ Day. Rep. Edward Markey, D-Mass, said:
“On April Fool’s Day, the biggest joke of all is being played on American families by Big Oil.”
J.S. Simon, senior vice president of Exxon Mobil Corp., which made a record $40 billion last year, responded, as the AP reported:
“Our earnings, although 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. We depend on high earnings during the up cycle to sustain … investment over the long-term, including the down cycles.”
To which Rep. Emanuel Cleaver, D-Mo responded that the up cycle has been going on too long. “The anger level is rising significantly.”
“I heard what you are hearing. Americans are very worried about the rising price of energy.”
said John Hofmeister, president of Shell Oil Co., reflecting the remarks and public attitude of the other four executives. The AP reported:
While Democrats hammered the executives for their profits and demanded they do more to develop alternative energy sources such as wind, solar and biofuels, Republican lawmakers called for opening more areas for drilling to boost domestic production of oil and gas.
What would bring lower prices? asked Rep. James Sensenbrenner of Wisconsin, the committee’s ranking Republican
“We need access to all kinds of energy supply,” replied Robert Malone, chairman of BP America, adding that 85 percent of the country’s coastal waters are off limits to drilling.
But Markey wanted to know why the companies aren’t investing more in energy projects other than oil and gas – or giving up some tax breaks so the money could be directed to promote renewable fuels and conservation and take pressure off oil and gas supplies.
“Why is Exxon Mobil resisting the renewable revolution,” asked Markey, noting that the other four companies together have invested $3.5 billion in solar, wind and biodiesel projects.
Exxon is spending $100 million on research into climate change at Stanford University, replied Simon, but current alternative energy technologies “just do not have an appreciable impact” in addressing “the challenge we’re trying to meet.”
The appearance Tuesday before the Select Committee … was not the first time that oil executives had faced the harsh words of a lawmakers frustrated over their inability to do anything about soaring oil and gasoline costs.
In November 2005, executives of the same companies sought to explain high energy costs at a Senate hearing at which Hofmeister emphasized the cyclical nature of his industry. “What goes up almost always comes down,” he told the senators on a day when oil cost $60 a barrel.
Six months later, they appeared again, when oil was $75 a barrel. But back again on April 1st, oil had gone up another $25+.
“We face a new reality, volatility, high prices, greater competition for resources,” said Peter Robertson, vice president of Chevron Corp., adding that he understands that “Americans see the pain” of $100-a-barrel oil.
Markey challenged the executives to pledge to invest 10 percent of their profits to develop renewable energy and give up $18 billion in tax breaks over 10 years so money could be funneled to support other energy and conservation.
They responded that their companies already are spending on alternative energy projects and argued that new taxes would dampen investment and could lead to even higher prices.
“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,” said Simon. He said over the past five years Exxon Mobil’s U.S. tax bill exceeded its U.S. earnings by $19 billion.
Markey was not impressed. “These companies are defending billions of federal subsidies … while reaping over a hundred billion dollars in profits in just the last year alone,” he said. The companies are reaping “a windfall of revenue” while poor people have to choose between heating and eating because of high energy prices.
Truckers Stage Protests Against High Fuel Costs – Antiwar Activists Stage Protests Against Iraq War Costs
The AP reported that also on Tuesday, April 1, many independent truckers parked their rigs and others slowed to a crawl on highways to protest high fuel prices. The demonstrations were only scattered, but long lines of trucks were moving at about 20 mph on the New Jersey Turnpike, and three drivers were ticketed for impeding traffic on Interstate 55 outside Chicago, driving three abreast at low speeds.
And as we have been reporting, antiwar demonstrator continue to occur across the country, protests against the rising cost of the Iraq war, the human costs, the 4,000+ Americans dead, 23,000 wounded, the 800,000 to a million Iraqi deaths, the displaced millions.
But, hey, let’s be proud that our people are dedicated enough to the oil companies to make the ultimate sacrifice. Gas has already hit over $4 and $5 in parts of California actually – up in Death Valley. How appropriate.