Energy Industry Puts Positive Spin on Record Profits

Jack Gerard, CEO of the American Petroleum InstituteAfter Exxon Mobil posted first-quarter 2011 profits of $10.7 billion -- $6.3 billion more than it earned last year by this time -- the company put out a defensive statement arguing that it is not to blame for gasoline exceeding $4 around the country. Instead, the company blamed skyrocketing gas and oil prices on the U.S. government, saying Exxon makes about seven cents on a gallon of gasoline, while state and federal governments collect 40 to 60 center a gallon in taxes. Jack Gerard, CEO of the American Petroleum Institute, the oil and gas industry's lobbying group, spun his industry's record income as a positive, saying high oil company profits signal a stronger U.S. economy. Gerard said Americans "should be proud" of a high-earning oil industry, since it supports millions of jobs and provides income for retirees in the form of profits paid on shares in people's retirement accounts. Exxon vice president Ken Cohen portrayed the push to eliminate $4 billion in government subsidies for the industry as an attempt to raise taxes on the industry, saying the subsidies help keep jobs from being exported to other countries.


Sure, the petroleum industry will blame the high price of gasoline on the taxes collected by both federal, state, and local entities. I'm sure that the oil companies, and the API all think that people are so stupid as to think that the taxes rise with the price of a gallon of gas. Maybe to a small extent, but not enough to cover the difference in price for petroleum products in the past year. Gas is up more than a dollar!

Why not look at the effect commodity traders (some of which are either petroleum companies, or controlled by petroleum companies) have when gasoline or oil prices are bid up high, sold off the suckers, who can't stay in the market, have to sell off below what they paid, and then the big guys buy low, run up the price again... it's a vicious cycle.

Thanks for writing, Anne

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