Sierra Club RAW: John McCain, Big Oil's Bestie as Record Profits (and Campaign Cash) Roll In

Last week ExxonMobil reported the largest quarterly profit in the history of American capitalism: a stunning $11,680,000,000. Trailing behind Exxon were Shell--$11,560,000,000; BP--$9,470,000,000; Chevron--$5,980,000,000, and CononoPhillips with a paltry $5,400,000,000. This bounty far outstripped last year's already record haul and puts Big Oil on track to pull down about $160,000,000,000 in profits this year.

(Though ExxonMobil edged its own previous record, it failed to meet analysts' expectations and its shares dipped. It was, however, very quick to point out that its profits would've been more like $12 billion had it not had to take a charge to pay that $500 million to those pesky victims of the ExxonValdez disaster.)

But it costs so much to explore for oil these days you say! Turns out spending on exploration has remained flat since the early '90s--a mid-single digit percentage of profits.

But the oil companies are running ads saying that they're moving 'beyond petroleum,' which means it must be so you say! Turns out that ExxonMobil spent a mere a 1 percent of its record profits on alternative energy, while self-proclaimed alternative energy star BP spent the most of any company--a still underwhelming 2.9 percent of its profits. Even Good Morning America, not exactly America's hardest hitting news source picked up on this one:

Turns out that Big Oil is reinvesting much of its cash (some 55 percent today, up from just 1 percent in 1993) in buying back its own stock and paying dividends to further enrich its shareholders. (That would include executives who hold or have options on millions of shares and who generally receive millions in bonuses based on stock performance.)

So, after hitting a real gusher of campaign cash from Big Oil, what does John McCain propose to do about high gas prices and obscene oil company profits? Why, he wants to give Big Oil a Texas-sized tax cut to the tune of some $4,000,000,000 a year.

Check out the TV ad Sierra Club launched last week in key battleground states:

And Barack Obama? He wants to give Americans $1,000 "emergency rebate" (paid for by taxing Big Oil's windfall profits) to get us through today's crisis and end the billions in existing government giveaways to Big Oil that John McCain has refused to cut off. Oh yeah, and he'll invest $150 billion in clean, renewable energy to end Big Oil's chokehold on America once and for all.

So, do we want a president who thinks a company making more than $1,000 a second in profits needs tax relief, or do we want a president who wants to give $1,000 to hardworking Americans to relieve their pain at the pump?

Seems like America literally cannot afford more of the McSame old thing on energy.

Follow Josh Dorner on Twitter: www.twitter.com/joshydo

Comments

[swift goat pet for truth]

Take it easy on JM.

He just lost an energy debate to Paris Hilton.

[DuganS1]

Exxon's business has actually been fairing quite poorly despite making higher profits. This is because they make virtually no money refining gasoline, have lower production, and face higher costs. Exxon's stock price is today lower than it's been since early 2007 when oil was in the $50s. Most people don't realize that refining has been a terrible business because it involves "buying" the expensive oil, refining it, then reselling it to a strapped consumer. Exxon is also having trouble because they rely on production in volatile countries like Nigeria. It's a shame they aren't allow to drill where the oil actually is in the US, Alaska and the OCS. Also, why should Exxon invest in alternative energy? That's not their business. Let companies in that business invest in it. Last, why is it evil to make money in business? Companies like Microsoft and Intel make a lot of money too so why not go for an excess profits tax on them?

[joebhed]

Gee, we're so sorry.
Those poor Exxon guys.

How come their stock price doesn't go up when they make gazillions in profits, even using THEIR accounting norms? That is really sad.
Or, is that the plan?

Like you said, its a real shame they can't drill everywhere they want to.
We can only hope.

Don't they have any of those 68 million acres of unused leaseholds that the stupid democrats are always talking about? Maybe they could buy some more with their huge profits, no?

I mean, to drill in, if they want to?

Where the oil actually is.

[DuganS1]

There's little oil on those 68 million acres of unused leaseholds. And what there is, there is usually too much red tape and litigation to deal with to make it worthwhile for the amount of oil they'd get.

[TxAggie]

I just read an article in the Wallstreet Journal that defines a "windfall profit". Looks like lots of folks are in trouble. Berkshire Hataway posted profit margins higher than Big OIl as did Google, Abbot labs, LG Electronics and thelist goeson and on. Not to mention the run up in government taxes on petroleum. I guess weare going to have a "WIndfall Profits" tax on all of the above companies and on the government itself in the interest of "change".

[LeftRight]

I'm still amazed that people think that the oilcos are making around 10%profit margins. Since they are not really selling much more oil than the used to, that means that they must be making MUCH more in profit margins. And since you must realize that they are making "profit" on EVERY transaction.....

Just to look at it, Exxon oil subsidiary pulls the oil out of the ground. Then they sell it (at a profit) to Exxon transportation subsidiary, who puts it into supertankers, and brings it to the US. They they sell it (at a profit) to Exxon refining subsidiary, who refines it down from crude oil to gasoline and other products. Then they sell it (at a profit) to Exxon transportation subsidiary, who sends it through the pipelines to the local transportation hubs. Then they sell it (at a profit) to Exxon gasoline subsidiary, who puts it into the gas tanks in the ground at your local filling station. Then they sell if (at a profit) to you. In the meantime, EVERY "profit" that occured during the process is passed onto you!