THE BLOG
03/03/2009 05:12 am ET | Updated May 25, 2011

"Exxon Profit Down 33% in the Fourth Quarter": Please Pity Poor Exxon!

Yes, that's the headline on CNBC.com. "Exxon Profit Down 33% in the Fourth Quarter." That is the kind of whitewash phrasing that might well have been cleared by that great partisan and advertiser of oil themed beneficence, the American Petroleum Institute.

You see, the real headline would have been inelegant in this day and age of economic hurt, job losses, and spiraling recession, namely:

"Exxon Mobil Reports Record $45.2 Billion Profit"


That's right, higher than the $40.6 billions record all-time high they gobbled in for 2007. And that's profits. You can imagine the dimensions of their cash flow when you add on depreciation, depletion allowances and royalty offsets, in all likelihood enhanced by a chummy Interior Department.

How many Americans would have a little more in their savings accounts to see them through tough times, or even just walking-around money if they hadn't been extorted by the oil companies and their allies at OPEC, mouthing the blather of "its all about supply and demand," while hiding behind a cartel-driven environment and a speculator-driven and corrupted commodity market, a snoozing and oil allied government, and then regaling and frightening us with such daily nonsense as "Unrest in Nigeria," "Fog on the Houston Ship Channel," "Hurricane Gustav is coming," "The industry is pumping at capacity," "Peak oil has arrived," "It's freezing in Maine", "blame it on the dollar", "it's the money supply" and, not to be undone, ExxonMobil's Chairman Rex Tillerson oil industry's Gettysburg Address, "ethanol is moonshine"? The list goes on endlessly. Virtually each new high in the price of oil was enshrined with a new alibi.

Thus was perpetrated probably the greatest heist in industial history, with a Bush administration cheering all along the way, obliviously dumping more oil into the Strategic Petroleum Reserve without any consideration as to price nor economic hurt. Thereby permitting the runaway dumping of the savings of millions into the coffers of the ExxonMobils of the world and their ilk.

But wait. Don't go away. It hasn't stopped. And remember even at today's prices, oil costs some 100% more than when George W. Bush took office (can you say the same for your home?).
The brainwashing continues and has evolved a new tack. You see, now we are being told that oil prices have to go up. "Energy Chiefs Say Oil Prices Must Rise to Ensure Supply," cautioned a January 29 Reuters report from Davos. "Many in the industry see $60-$80 as a more desirable level, up to double Thursday's price of around $41 a barrel". Ah, Davos, instructing us from on high to let us all know what is in our best interests. "That seems to be what you need to get investment," according to the arms length opinion of Tony Hayward, BP's Chief Executive.

As for OPEC? Please see "OPEC's Noble Cause" (12.17.08). And to quote OPEC's Secretary-General Abdullah al Badri, "OPEC will not hesitate...Even with $50 we cannot have a decent income for our members." Well, the gang down at Irving, Texas, where ExxonMobil is headquartered is certainly cheering him on, hoping he succeeds brilliantly. And surely in anticipation, the guys and gals at Exxon went on a buying spree this last quarter, purchasing 119 million shares of their own common stock for some $8.8 billion.

By the way, just to show you the enormous pricing pressure our friends in the industry are under, one of ExxonMobil's brothers in arms, Royal Dutch Shell's fourth quarter earnings fell by 28 percent to only $4.79 billion. Tough times these, especially given all the hurt and pain we are beginning to hear from the oil patch, their cohorts and flacks. This "steep" decline will surely curtail their exploration and new investment budget? Perhaps, given their priorities. You see, but it hasn't stopped Shell from doing what virtually no company on the face of the planet is doing, nor is able to do just now. They are raising their dividend!