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Jonathan A. Schein

Jonathan A. Schein

Posted February 5, 2009 | 10:55 AM (EST)

Had Enough?


When it comes to oil, the bells don't yet seem to be tolling. Although the price of this energy source has fallen far from last summer's high of $150 per barrel, oil companies are still enjoying the financial fruits of that period. Exxon Mobil Corporation just posted its 2008 earnings: they took in $45.2 billion in profits, although in the last quarter, revenues slipped by 33 percent. This extraordinary figure broke the company's own profit record of $40.6 billion, which was set the previous year.

Of course, Exxon Mobil doesn't derive all of its revenue from oil, as it is a diversified energy company with many different facets. And in general, profits are a very good thing. However, the idea that a company whose main line of business is focused on profiting from a product we so desperately need to move away from due to environmental, national security, and financial concerns, should really give one pause.

The next time you pull up to a filling station, think about this: do we really need to help a company earn $45.2 billion in profits when the global economy is teetering on a very precarious perch? We need to acknowledge that the time has come to move on.

When it comes to oil, the bells don't yet seem to be tolling. Although the price of this energy source has fallen far from last summer's high of $150 per barrel, oil companies are still enjoying the f...
When it comes to oil, the bells don't yet seem to be tolling. Although the price of this energy source has fallen far from last summer's high of $150 per barrel, oil companies are still enjoying the f...
 
 
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07:54 AM on 02/09/2009
Numbers without context mean nothing. $45 billion, shriek?!

As I recall from somewhere in 2008, when 'the commons' was screaming about windfall profits, the actual net profit was but 8.3% ... what markup does your elect5rician, plumber, lawns guy, or other tradesman, put on their effort? Eh?

AFAIK, the first person to blow the whistle on oil declinining was Admiral Rickover, in his book from 1953, "Education and Freedom". He gave it a hundred years, I reckon no one took any notice.

Once I owned a Lincoln Continental 1966 4-door convertible, damn, that was fun. Now, after 3 VWs, I have a 5 y.o. Toyota Echo, bought new.
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cayuse
Soaring Eagle, soaring to Spirit from the ego self
02:42 PM on 02/08/2009
I can only say I live 280 miles from work. I suppose I could move to the city where I work and still commute 40 miles to work each way. The trouble is the cities I work are 280 miles apart too.

So I wll move to one of the cities get an electric car to plug in each way for the 40 mile commute and more every year for the job that does not last that long.

You will call it GREEN and I will call it stu peedo
01:10 PM on 02/08/2009
Oh my. Guilty of size. Is Exxon even close to the most profitable by any measure, such as return on sales, return on investment, return on assets? Did it provide extraordinary returns to stockholders? No! No! No! Furthermore why doesn't everyone understand that corporations pass taxes through to either consumers, employees, creditors or stockholders. Ultimately only people can pay taxes. A corporations is a legal structure that defines rights and obligation among owners, employees, customers, creditors and suppliers. As such any tax on a corporation must be borne by one or more of these groups.

An example will clarify this assertion. If the price of copper increased, would plumbers absorb the cost increase or pass it on to customers? Since every plumber presumably suffers the price increase, logically the increase would be passed on to customers.

Assume instead that taxes were increased on all plumbers. Is there any reason to believe that this increased cost would be absorbed by plumbers instead of passed on to customers?
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terramartom
People for the people. Revolution.
11:41 AM on 02/07/2009
This is a "Resource" driven World.
Oil, natural gas, timber, minerals, water are why each country will do anything to get access, and control of these Earthly assets.
No reason to be surprised.
As long as all politicans are controlled by their greed, there will be many wars fought in the name of these natural resources too!
Birth control. All forms.
Human populations are exploding World wide using religion/ ignorance as their "God" given excuse.
Intelligence, science, reasoning are, and will be the driving force for Humanity into the foreseeable future.
Good fortune, because there is no "luck, or superstition' required.
outnow
Ban the bomb
11:11 AM on 02/07/2009
Big oil is controlling our government, just as the drug pushers are controlling Mexico's government. The depletion allowance issue dominated politics for decades, now excessive profits. Oil is running out so the conflict intensifies with climate change being the final outcome.
04:27 PM on 02/06/2009
ExxonMobil’s earnings get a lot of attention.
I know. I work in media relations for ExxonMobil.
Not many know that despite our record profit last year, we earned less than 10 cents on every dollar of sales. And for every dollar we earned, we paid two and a half in taxes.
It takes big money to power the world. A single project can exceed $15 billion.
Some more numbers: It costs more than $1 billion every day to run ExxonMobil’s global operations. We're spending record amounts -- $26 billion last year -- to find and develop new sources of energy. That’s over $71 million every day.
We also make more than 80 percent of our earnings from outside the US and more than three quarters from the part of the business that finds and produces oil and natural gas -- not the part that refines and sells gasoline to consumers.
Consider this – ExxonMobil is the largest non-government owned energy company in the world but it produces only two percent of the world’s energy. The world’s energy challenge – finding enough energy while protecting the environment -- is big and it’s complex. Many solutions, including all sources of energy -- oil, gas, wind, solar, biofuels -- are needed.
Our CEO, has been talking about the energy challenge. Here’s a link to his most recent speech. http://exxonmobil.com/Corporate/news_speeches_20090108_RWT.aspx
Alan Jeffers, ExxonMobil blogger
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littleblackcat
05:45 PM on 02/06/2009
Sorry, Mr. Jeffers, it won't wash. With all your "costs" and "taxes paid" Exxon still made a

F O R T Y - F I V E - B I L L I O N dollar P R O F I T !!!!

Profit! Exxon could afford to buy a hybrid automobile for every working person making under $50,000 a year without losing half of its "profits".
02:01 PM on 02/08/2009
why is it exxons duty to do so? why not the govt. shouldnt it be the govt that buy everone a hybrid. i am ok with that
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ljmck
Stand Up, Show Up, Speak Up
02:57 PM on 02/05/2009
If we must pay high prices for gasoline, it ought to be in the form of taxes that pay for infrastructure and alternative energy development, rather than as profits for the oil oligarchs.

Is there a way that oil companies can be paid for extracting and processing the oil that belongs to all of us, while profit from consumer use goes to entities that benefit everyone?

Why do oil and gas leases mean that the lease owners own the entire product?
06:50 PM on 02/06/2009
The oil companies pay competitve lease bonuses for the right to explore i.e. risk millions of dollars in searching for reserves with success coming perhaps 1 out of four tries. They pay royalty to the mineral owner (be it state, private or federal) and yes the companies then own the reserves in the ground subject to paying the royalty when it is extracted. In Fedral waters the royalty varies from 12.5% to 18.75% depending the vintage of the lease. This is risk free revenue to the feds. No there is no way to pay the oil companies to extract and process while giving the profits to consumers. Who would find it? What is the reward for taking the risk? Who would take the risk? Oil and natural gas is not farmed, it is not mined, it is not manufactured. It is scarce and darn hard and expensive to find. In answer to the author, yes we do need companies like Exxon with profitsof $45.2 Billion in order that we may have an american company with the wherewithall to compete on the world stage in the search for oil and gas.
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Articulator
10:43 PM on 02/06/2009
I agree, the leases need to be reviewed very closely, especially since the last one to have their hands on it was the administration headed by the Texas oil man George. Can you imagine there's even a single big oil executive in America that isnt on a first name basis with the Bush family. I remember when George Sr was vice president, at one point he went over to the Middle East to help in the negotiations to keep OPEC from falling apart because the "high price of oil was good for America". His nickname in the White House at that time was JR Bush after the character in the tv show Dallas. Around that time I saw a number of articles in various publications making the argument that the high price of oil was good for America. That's when my eyes were opened on how the media can be manipulated. The only thing that I could get out of the articles was that there's oil in America too but it costs a lot more to get it out of the ground for various reasons and is only worth while if the price of oil is high enough. In other words "good for America" translated to good for a few wealthy oil barons in Texas.
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Dr. Susan Corso
omnifaith spiritual expert
12:26 PM on 02/05/2009
I've definitely had enough. The profits are scandalous when people can't afford to drive to work or feed their families. Welcome to HuffPo, Jonathan A. Schein!
10:18 AM on 02/09/2009
I agree that's the crux of the problem. Now when demand is down because many of us can't afford to eat and drive to work, the oil companies will be whining that their profits are down.