Senator Barbara Boxer, a California Democrat who sharply criticized oil executives appearing before Congress in November, struck again on Friday. She called on the Bush Administration and the Federal Trade Commission to "put an end to gouging," then suggested that FTC stood for "Friend to Chevron."
Democrats complaining about big business is nothing new but republicans calling for a tax increase? This must be serious. Both of these are examples of the ignorance of those in government. Don’t be fooled into thinking that the increase in the price of gasoline is a scam being put over on Americans by the big bad oil companies. You’ll look as silly as the idiots in
The price of crude oil has more than doubled in just over 2 years.
Gasoline prices here in
If the price of your raw materials doubled what would you do?
Perhaps the oil companies are working together to fix prices? Thomas Sowell reports that just isn’t the case.
“The Supreme Court's recent 8 to 0 decision (Justice Alito not yet participating) shot down a claim that oil companies were colluding in setting prices. That claim was upheld by the far-left 9th Circuit Court of Appeals but neither liberals nor conservatives on the Supreme Court were buying it.”
When’s the last time all of those folks agreed on something?
But what about the “record profits” we keep hearing about from sound clip bullhorn of mainstream media? “Oil industry awash in record levels of cash” says MSNBC. Are we really being gouged? Hardly. From the Jeffery J. Brown via Energy Bulletin we get a better explanation.
“Oil prices are up substantially since mid-February. …careful examination of recent supply data provided by the US Energy Information Agency (EIA) suggest… oil importers are bidding against each other for available total petroleum (crude oil + product) imports.
Since the week ending
This sharp decline in net
It turns out MSM reporters are either ignorant of the facts or lazily looking for an easy story. Just like our representatives in
The profits margins of big oil are inline with those of other
“Newspapers, part of the media that criticize oil profits, heavily outperformed Exxon in 2004. “The average 2004 operating margin of publicly owned newspapers… was 20.5 [percent],” the Los Angeles Times cited industry analyst John Morton in its
The Mail Tribune of Oregon reports more accurately on the state of profits in the oil sector, “The industry says among oil companies that have reported earnings this quarter, profit margins have averaged nearly 9 percent, which is just below the average across all U.S. companies that have reported results this quarter. Exxon Mobil had a profit margin of about 10 percent.”
Free Market Project says, “While Exxon’s profit is large in terms of absolute dollars, but so is the company. In 2005, profits for the world’s largest oil company were only 9.7 percent of its revenues, up from 9.6 percent of revenue in 2004, and far less than the 2004 Bank of America profit margin of 21.6 percent or Johnson and Johnson’s 18 percent, according to data from Forbes magazine.
Investorguide.com points to more big winners. “The net profit margin of the pharmaceutical drug manufacturing industry is 16.9%. For example, Merck and Pfizer have net profit margins of 20.4% and 15.5%, respectively.”"The money center banking industry, which includes Wachovia, CitiGroup and Banc of
What was the profit margin for Exxon in 2005 again? Answer 9.6%. And the average among companies in the oil industry reporting for the first quarter of 2006? Answer, “net profit margins are 9.1%.”
Listen, I don’t like big oil. I think history will prove them and their industry as one of the most wasteful and destructive associations in human history. And I certainly don’t suggest trusting everything they pronounce but hell, The Hershey Company has a better profit margin than Exxon. Trying to blame the rising cost of gasoline on gouging by Big Oil is silly and unfounded; not to mention it takes the spotlight off the coming crisis. Peak oil is arriving. Wake up to the reality and then help others do the same.