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Who's to Blame for Oil Profits?

I'm often asked this question: How did Big Oil conspire to get its big profits? The idea that a company like Exxon Mobil could earn $11.7 billion in a single quarter boggles the mind, even if you know what a far-flung empire it is.

Two years ago the online magazine Slate (a sister Washington Post publication) published a Michael Kinsley piece about taxing oil companies that touched on the subject. Kinsley noted that oil wells that could be profitably operated at $46 a barrel (the price a year before his column) could be even more profitably operated at $70 a barrel. Kinsley wrote:

To get this windfall, the oil companies didn't have to conspire with the Bush administration to start a war in Iraq. They didn't have to conspire among themselves to raise prices at the pump. If you own oil anywhere in the world, you didn't have to do a damned thing. Just close your eyes, make a wish, open them, and - surprise - you're getting an extra $25 a barrel.

Naturally, those same wells can be tapped more profitably still at $120 or more a barrel today.

Yesterday, in an effort to get a little more historical perspective, I called Jay Hakes, who was head of the Energy Department's Energy Information Administration from 1993 to 2000 and who is currently head of the Jimmy Carter Presidential Library and Museum in Atlanta. He witnessed the tussle in the late 1970s over the profits of the giant oil companies, including the passage of the windfall profits tax. At the time, President Carter had twinned the windfall profits tax with the lifting of price controls that had been in place for years on much of U.S. oil and gas. Some news organizations rented helicopters to see whether the oil companies had rented tankers and had idled them just off the coast to withold supplies and drive up prices.

Hakes, who has just published a book titled "A Declaration of Energy Independence," said his view on Exxon Mobil's profits goes something like this: "My basic explanation is that most of the oil reserves in world are controlled by state-owned oil companies," he said. "It's the explicit policy of OPEC to keep supplies tight and prices high. And other countries like Russia agree. So Exxon becomes kind of a free rider to that problem."

As a result, he said he has a problem with both sides of the recent vociferous political debate over oil company profits and their connection to high oil prices. Recent ads, he says, sound "strangely familiar" to the ads taken out in magazines in the late 1970s. Hakes said, "The historical perspective is that the oil companies always blame the environmentalists. The environmentalists and consumer groups blame the oil companies. And no one points the finger where it belongs, which is OPEC."

Read Related: Poor Rich Exxon Guys

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Comments (140)

Scottar:

Are current energy crisis is probably due to:

Affluent lifestyle based on a decreasing commodity.

Limiting oil drilling

Not encouraging CAFE sooner.

No substantial investing in Nuclear breeders and series IV reactors research in the 80 and 90s.

Not planing for peak oil and gas.

Falling for the envirowacko's fear mongering on carbon footprints driving global warming which has led to costly unreasonable inviro regulations.

Buying on credit and loan for frivolous reasons.

Over reliance on government handouts and subsidies.

Thinking cheap oil and gas would last forever. Besides, we've tried windfall profits taxes before, in the early 1980s, and they were an utter failure. As the Congressional Research Service found, revenues produced for the government were nearly 75% below what was expected. Meanwhile, domestic oil output fell 8%, while oil imports surged 16%. That's just poor policy, and even worse economics.


Thinking big government will solve all their woes. Can't meet the subprime mortgage increases, don't worry, uncle Sam will bail you and those scheming loan investors out of the default zone. I mean, after all, they print the money- right?

Harping on the blame game, it's big oil guys and their secrete underground organizations. After all, non oil associated people understand the economics and technology behind oil and gas production, right? Regulate prices by taxes, yeah that's the ticket, worked before with Communism right? And by the why, guess who just endorsed Obama? Com'on now, don't strain your thunker.

Yeah it so easy to blame it on everything but common sense. When your importing 70% or more of your energy from volatile areas around the world, don't go blowing your rainyday fund.

Invest for unforeseen shortages, reduce your energy reliance as much as is reasonably possible. The US has overextended it energy credit and has relied to much on credit financing. they set themselves up for shoddy investors and flimflam creditors.

Common sense and frugal investments has gone out the window with personal responsibility. America has become too much of a pudz for gullibility and expectations. They spend what they really don't have or don't really need, all for that big affluent American dream that has outgrown economic realities. It's happened so many times in the past to civilizations that got too arrogant and hedonistic.

But hey, the Democrats got more rich investors for their causes, mostly from lawyers, yet not much is said about their rip-offs. Courtesy to fellow sharkies?

Van:

You want to see oil prices drop, legalize industrial hemp. It has about the highest seed to oil content of any plant in the world. It's not marijuana and if it wasn't for the fossil fuels industry we would not be in this bind today because we would be meeting our energy needs through this great plant.
Ron Paul and Ralph Nader have talked about hemp but the neocon controlled media in America will not allow any discussion of this wonderful plant.
It has many uses and the Agr. Dept classifies it as biomass. The DEA says it is a drug.
It was made illegal in 1937 because of it's socalled association to marijuana. This is strange because there was no problem in America with marijuana in 1937. Industrial hemp was the target. The petroleum industry couldn't compete. When you can't compete fair in our society we cheat. Look at the current republican party.
According to our energy dept if we ok'd drilling today it would take about 10 years before there was a drop of oil and 20 years to be at full production. The amount that we would produce to the world market would be negligible.
The things we can do now our simple and cheap. Lower our speed limit. Bring back cafe standards. Stop purchasing gas eaters. This has already started with some of us and the price has been dropping accordingly.

C.P.JACOB:

Its a little sickening to hear over and over again that the huge increase in Oil Prices was caused by a rise in demand for Petroleum in CHINA and in INDIA.

No attention is paid to the fact that Oil prices have started falling due to decreased demand and the economic downturn in the United States......!!!!!!

The United States consumes more than 24 per cent of the Worlds' Oil.

What gives America the right to consume more than a quarter of the World's Oil....????

SINS,.....HAVE A HABIT OF CATCHING UP WITH THEIR PERPETRATORS......!!!!

observer 31:

Marc Jacobs said :

"Income - Expenses + Profits. For profits to increase the amount of money (income) has to exceed the amount of money going out (expenses).

It seems obvious to me that since Exxon/Mobil has set another record for its quarterly profits that the price they charge for their products(gasoline) is going up faster than the cost of their raw material (crude oil)."

Not quite. Your analysis is way too simplistic.
If you sell more your profits are up, without any changes in the price or in the cost incurred. Also, cost is far from being just the price of crude. Many companies are quite effective in reducing costs and thus increasing their profits.

Many pointed out the need to look at the profit margins.

Waterboy:

To hell with oil -- I can survive without it. I'm investing in clean water.

Randy:

I think the better question to ask is why as a nation and the world we have become so oil dependent? I think it has been because a barrel of oil was so cheap. When I was growing up in the sixties, families had one car and gas was in 30 cent range, seemingly for ever. So oil/gasoline was not a factor in a families budget. It was paper and not plastic bags at the supermarket and soda bottles were of glass and had deposits on them to spur you to return them. Now families' driveways are full of cars, and plastic disposable products are everywhere representing convience and affluence in America. If gas was still in the $1.00 to $2.00 range a gallon today we would think twice about oil company profits, no more than Bill Gates' $70 billion net worth. Also we would continue along with our affluent lifestyle not giving much thought to the environment. But gasoline is around $4.00 and we are looking for someone to blame because it is impacting our standard of living and adding to the nation's economic problems. But we fail to see that other world ecomonies have come about since the sixties. First the Japanese in the 1970/80's and now recently both China/India with their 2 billion+ consumers are using petroleum products in ever increasing amounts. So now the world uses 80+ million barrels a day and rising, with supply just keeping up. I have seen figures where gasoline consumption in the U.S. by automobiles makes up only a 1/3 its consumption. So 2/3 is used in industry. Even U.S. stopped using oil for gasoline consumption, other economies of the world would quickly use the 7-8 million a day capacity that the U.S. would free up. This enomous consumpiton is generating pollution in every city of the world it is used. The oil that we have come to take for granted, is now a scarce commodity because of its high static demand where if any producer in the world has a temporary or imaginary halting in production, causes the world price to sky rocket. This foul smelling commodity which nobodies wants produced or refined in their "backyard" is hazardous to the environment, our economy, and our national security.

I am hoping the high price of oil, as a nation, will be wake up call to be more self reliant in energy. Not in the direction of producing more petroleum but towards environomentaly friendly sources such as such as solar and wind. I have read some of the comments above to increase the supply of oil by drilling offshore and the such. I think these solutions are short term and of course will provide short term lowering of a barrel of oil and the price at the pump. The better solution is to shift out of oil dependence and to those products produced by it to environomentaly friendly sources of energy/products. As a consumer I would like the nation to think more "green" it is production and purchasing. Examples would be using a basket instead of plastic bages to bring home groceries to building "green" homes that are economical to run, even off the electric/gas/oil grid. As a commuter, a rechargable electric commuter car, charged by my home grid, would be wonderful green choice and reduce our reliance on oil. I am hoping General Motors is succesful in producing the Chevelot "Volt" electric hybrid car so I can have a choice in buying an American car again that isn't reliant totally on petroleum. Also recycling of oil based products would also be a good choice for the future of the country.

DaveC1:

Vanitsky:

It's interesting that I am in the oil & gas industry, in Houston, Texas, and you are in the oil and gas industry in Russia and I seem to agree with everything you just wrote.

Oil and Gas is a global market and the price is based on global supply and demand.

Global supply and demand are a bit out of balance at the moment.

It's nice to produce oil and gas at home but a barrel is a barrel when it comes to the price of oil and gas.

sacomment:

So, what you're saying is that offshore drilling won't help lower gas prices? It'll just make the big oil co's even MORE profit. Only reducing the amount of oil we use (regarless of its origin) can decrease gas prices, as we have seen in recent weeks. Good to know.

DaveC1:

We had a long period of low prices from the late 1990's through 2003 and very little drilling was done around the world. As a result, current production capacity is lower than it should be. Nobody complained in 1999 when I was being outsourced from the oil company where I worked. Man, we were really hurting.

During that same period, every attempt to increase fuel economy standards for the US vehicle fleet was laughed off and sales of big SUVs and pickups soared. Now we have a vehicle fleet that is very inefficient. Also, during that period, global demand increased.

Now we find ourself in a temporary price spike and everyone wants to blame someone. Fact is, this will not last. Drilling is running flat out around the world and sales of big vehicles has screeched to a stop. Give it two years, gasoline will be below $3.00 in the US and falling.

Opec has a limited ability to influence prices.

Nouri:

SPECULATORS ARE RESPONSIBLE IN THE FIRST PLACE ABOUT THE INCREASED OF OIL PRICE, STUPID!

"One of the things I think is very important to realize is that the growth in the world oil consumption is not that strong." —David Kelly, chief market strategist, J.P. Morgan Funds; The Washington Post, May 4, 2008

"...There is substantial evidence that the large amount of speculation in the current market has significantly increased [oil] prices." —U.S. Senate Staff Report, The Role of Market Speculation in Rising Oil and Gas Prices, June 27, 2006

I am sure if the state has imposed a windful profits tax on Speculators and Traders for economical and social reasons, we will see whether oridnary US citizens, will be still paying over $4.00 a gallon for gas.


Isnt it time for these Obscene Greedy Speculators and Traders who bought oil at $40.00 a barrel to collect their windful wins and SELL NOW!

Or is their patriotism saying to them, stuff the ordinary citizens and their hardship, let me carry on with my speculation and make as much money as possible, regardless of the consequences in the long term for the economy and the image of Traders and Speculators!

JeffRandom:

Makes sense to me. I like to maximize my profits (usually by asking for a raise) too. Nothing wrong with that.

People scream at Congress to stop oil companies from profiting "excessively" but would scream even louder if Congress were to put a stop to their home equity appreciation.

Likewise, when the housing market tanks they want Congress to act, but when oil companies are in the doldrums this is "okay".

Sigh ... people never learn.

pgr88:

Given that 90% of world oil production is in the hands of nationalized/socialist oil companies, Exxon, et al. have no power over pricing. Of course, nationalized companies will mis-price their assets and not make rational economic decisions. That's who we should blame for high oil prices. Exxon is smart enough to run an efficient, modern enterprise, and is lucky enough to be competing with retarded state-run organizations.

vanitsky:

A very intresting discussion.

Living in Russia most of the time I would like to add some information.

Gas proces in Russia are as high as in the US.
Though all of oil is produced here.
Gas prices are based on world crude oil proces and taxation.

So I can't understand : HOW DRILLING in U.S. MAY POSSIBLY LOWER PRICES???

All produced oil will be going to the market.
No matter where it is produced and refined - consumer prices' trend will not change.

Yes, the only way is smaller cars and taxes on car sales as in EU (and in Russia): sale tax is based not on the price of the car as today - but on volume of engine and number of hp.

It makes, say, Explorer, $55,000 here in Russia + ca. $5,000 registration fee.

Who is to blame? Right - bad habits of consumers and the wrong long term policy.

Make the GOP Republicans Fix This Gigantic Mess:

President Obama Contrast With McCain


Growing Up

McCain was privileged, given everything by both parents, and worked for nothing.


Obama grew up poor, raised by his Irish-American single mother and Irish-American maternal grand parents. Obama was given nothing and worked for everything.

Education

McCain was a D student and graduated last in his class. McCain and McBush share failed academic records. He partied constantly and dependent on favor handouts from his high ranking father and grandfather. McCain earned nothing on his own similar to McBush.

Obama worked hard and became President of the Harvard Law Review. Everything that Obama accomplished he did on his own. Obama’s hard work represents the American Dream.


Community Service

McCain poor studies translated into poor performances in the military where he crashed several planes and recklessly endangered the lives of others. McCain was never trusted by his colleagues nor loved by his peers. The highlight of McCain’s career was getting shot down and becoming a prisoner. McCain served his country by getting handouts from his guards. Getting handouts seems to be McCain’s modem of operations.


Obama turned down large profits after graduating from Harvard Law School to serve the community in Chicago where help was needed most. The community learned to trust and love Obama for his dedication to the people.


Marriage

McCain walked out on his family to chase a younger woman who was on drugs, embezzling money from her company, stealing, and facing criminal charges, until her privileged family saved her from trial. McCain’s dysfunctional family represents chaos and lack of respect when he curses her in public.


Obama married an intelligent Ivy League attorney and adores his beautiful young daughters. Obama’s First Family represents what America is striving for.

International Diplomacy

The World wants no more chaotic McBush-McCain.


The World loves Obama and will follow America’s leadership behind Obama.

alance:

It was Obama who voted for the Bush 2005 energy bill that was a gift for the oil companies. Obama has also received $400,000 from big oil contributors for his election campaign. Now he is biting the hand that feeds him. McCain voted against that 2005 energy bill.

It is the Democratic Congress that obstructs energy independence:
No off shore drilling
No new nuke plants
No new refineries

It is OPEC, not the oil companies, that is responsible for the high cost of gas. Assuming that Pelosi, Reid and Obama will ever permit more drilling, the oil companies will need a fortune to find the oil, refine it and get it to market.

James:

The free market adherents want people to believe that oil profits are simply the result of supply and demand. Supply has long been a matter of manipulation among a number of commodities. Diamonds for example have long had a controlled supply chain. It does not matter that diamonds can be found all over the world. Oil supplies and prices have similarly been the object of supply manipulation. Even at the nadir of the Iraq War (I believe Iraq was then the #3 producer of oil) the price of oil did not rocket to its current levels as oil prices have over the past to years. If the market is free then the nation of Niger, the almost singular producer of certain types of uranium, would be among the wealthiest nations in the world.

Charlie:

What is a neocon? Really. It is usually a pejorative but even the people who use it either don’t know what it means or are not saying. (I suspect the former.) All emotion aside, what is it supposed to mean and is it a combination of NEO and CON? I can’t seem to make any sense out of the word by looking up the roots.

Tom M. :

Here is a list of companies you should recognize and thier rough net income margins:

Citigroup - 33%
Microsoft - 32%
Coca-Cola - 21%
Procter & Gamble - 14%
General Electric - 11%
ExxonMobil - 10%

However, you don't see people screaming at Citi or Microshaft about thier margins. Sellers of refined products are not the ones reaping the largest gains in net income, so much as it is the refineries themselves.

Most refiney operations yield margins of around 20-25%, but as with anything in business, return is a reflection of risk taken in generating sales. The majority of the refiners operate on the gulf coast, which was evidenced by Hurricane Katrina as a volitalie area to run a platform. Also, the jobs on the platforms themselves are dangerous and they must pay thier employess accordingly to man these operations. As such, they need to reap big profits to give themselves enough of a working capital cushion to fund fixed expenses, should a natural disaster shut down thier operations for months, leaving them buring through cash with no offset from income.

ExxonMobil also has significant risks, which are probably not reflected in thier returns as pressure from consumers and lawmakers have squeezed margins over the years. Any business with as much cash flow and trade as ExxonMobil has risk factors from transportastion risk, oeprational risk, currency exchange risk, HUGE contingent liabilities, etc.

For example, lets say you have 25 billion euros sitting in your clearing account from EU operations and the exchange rate of dollars to euros shifts by 0.015, all of a sudden Exxon has lost $375 million euros in an eye blink. Not to mention the bath they can take on futures contracts. Improper bets on the movement of oil prices can wipe out billions overnight.

Oil companies are actually capturing lower profits than the market would bear, as evidenced by the explosion of oil and gas prices early in 2005 and again after Katrina. The demand for oil and gas is pretty elastic with regards to price, meaning that increases in price do not cause corresponding decreases in demand. Also, Sarbanes-Oxley has made it pretty hard for any company to hide profits (or losses) in hedge movements or derivative positions.

The margin stays the same but the dollar amount increases as a percentage of the prior year. If E sells $1,000,000 in gas in 2004 at a 10% margin, they make $100,000. If E sells $1,500,000 in gas in 2005 at a 10% margin they make $150,000. It appears as if they increased profits by $50,000 or 50%, but they also increased sales by 50%, so the profit margin as a percentage of sales remains the same.

The parallel increase in cost of goods sold is what keeps the net margin constant.

Of course, the falling exchange rate of the dollar doesn't help ExxonMobil's profits either.

FRANK:

OIL IS A COMMODITY, LIKE MANY OTHER THINGS WE PURCHASE. IF WE WANT SOMETHING THAT IS IN SHORT SUPPLY AND HIGH DEMAND ( DIAMONDS,MASERATI CARS, HOMES IN PALM SPRINGS ETC ETC) WE PAY THE PRICE THE MARKET CAN BEAR. IF WE WANT SOMETHING THAT IS PLENTIFUL OR EASY TO GET, SAME THING APPLIES AND PRICES WILL BE LOWER, SIMPLE. NO DOUBT THERE ARE ORGANIZATIONS/PEOPLE WHO CAN ARTIFICIALLY KEEP PRICES HIGH BY RESTRICTING THE SUPPLY OF SOMETHING THAT IS PLENTIFUL, SO THAT IT BECOMES RESTRICTED OR RARE, SEE ABOVE LIST.IF WE WANT MORE OIL SO WE CAN CONTINUE TO LEAD THE KIND OF LIFE WE HAVE LED IN THE PAST, AND NOT PAY A RANSOM FOR IT TO OPEC,THEN LIKE NEWT SAYS DRILL HERE, DRILL NOW,PAY LESS.GUESS WHO STOPPED US DOING JUST THAT FOR THE PAST 15 YRS? OH I FORGOT WE ARE A GREEDY WASTFULL NATION

Nouri:

Who's to Blame for Oil Profits?
The question should be re-phrased to:

Who's to Blame for Oil Illegal Excessive Profits?

The answer: The neocons Mafia and their allies that work in harmony from the likes of Halliburton (supporting invasions), to Blackwater (providing mercenaries) to AIPAC (Networking) to Fox News(Misinformation) to interested parties like Exxon-Mobil that fully supported such actions instead of deciding not to invest in corrupt ventures with US Taxpayer's money being wasted.

IS PATRIOTISM SUPPOSED TO BE IMPLEMENTED JUST BY ORDINARY SOLDIERS AND CITIZENS OF THIS COUNTRY WHEREAS THE TOP ECHELEON OF THE COUNTRY, REPRESENTED BY THE TOP 1% OF THE POPULATION ARE IMMUNED FROM THEIR PATRIOTIC DUTIES!!!!

bmalone1:

Big Oil has intentionally slowed production outputs by not using profits to improve refining capability, by failing to develop available drilling opportunities (while demanding new leases) and by insisting on continuing their current taxpayer subsidized leases. We complain that Congress doesn't 'do anything' to divert some of those outrageous profits back into the public coffers, but, in this country, no one expects that the oil companies will voluntarily adjust their gluttonous ways.

Ivory, DC:

1. Commodities are denominated in U.S. dollars. When the dollar drops, it takes more greenbacks to buy the same barrel of oil.

2. The U.S. consumes 25% of the world's energy. We've been greedy and wasteful and now China wants to live like we do.

3. Five oil wells in Saudi Arabia generate 90% of their oil production and they're all fifty years old. If OPEC increase production, the water encroachment would create gas caps and trap the oil into the ground.

Silly:

OPEC is to blame? For what? Increasing their profit margins? Like they're supposed to? That's silly at best. OPEC is a cartel that has only in the past 10 years or so started to become effective at controlling prices. This was inevitable, as that is its stated purpose and thus it was only a matter of time before the countries comprising OPEC figured things out. Yeah, I guess they're technically to blame, but blaming OPEC for high oil prices is liking blaming a cat for killing mice. They're both doing what they're supposed to do, so assigning "blame" doesn't really make any sense.

Assigning blame to factors that we CAN control does make sense. The major fault lies with the US government's not forseeing this inevitability and attempting to head it off at least somewhat by raising fuel standards, finding alternative sources of energy, and whatever other approaches would lower demand (and thus prices). Dubya's inability to run an economy in concert with his bellicose rantings and ravings about phantom enemies are aggravating the situation by making people nervous about oil supplies and thus adding a "Crazy Dubya" premium on each barrel. Ain't nuttin' gonna get fixed until we stop electing mentally handicapped presidents.

Crooks working together:

Imarkex - good grief what a load of ignorant puff.

Blame is such an asinine game in this country ... OPEC is NOT the main source of the high prices.

C'mon people. OPEC is one piece of a much larger conspiracy to fleece the public. Do you honestly believe that US big oil execs are NOT working WITH OPEC to manipulate prices? DO you honestly believe that oil speculators were NOT getting the thumbs up from Big Oil or the Bush Administration? Has everyone forgotten about Cheney's closed-door energy policy meetings with Big Oil execs in 2001?

OPEC, Big Oil, Bush Co., Republicans, Democrats, Wall Street ... are ALL WORKING TOGETHER to keep prices high.

As for who is to blame ... Republicans have far more invested in oil than do Democrats, but make no mistake ... they are ALL CROOKED.

rick0120:

I think fundamentally, like any other good or service, the high price of oil is the result of us USING SO DAMN MUCH OIL!

You do not have the right to complain about oil prices if you are driving a big SUV and have a small family. Sorry.

Sloburn:

Hillman you have it right. There is no reason why anyone operating a oil lease can not be required to sell the oil domestically. If that oil were for domestic use only the price here in the US would fall dramatically. Which might be the reason you never here the environmentalist get on board with this concept.

Hillman:

I've never quite understood why oil and natural gas taken from public lands owned by the US taxpayers is considered a commodity which we essentially give to private oil companies, who refine it then sell it back to us as hugely inflated prices.

Why not insist that all oil taken from US government lands be sold back to us at a certain rate.... leaving enough for reasonable profit.

If not, then why not have the government themselves set up an oil company and do it themselves?

I'm not an oil man, so maybe there are logistics reasons why we don't do this.

But it seems silly to me to allow private companies to extract public resources on the cheap, then sell them back to us at very high rates.

Nouri:

I blame it on the obscene greed of the NEOCONS and their allies who thought the fact there is a weak Russia and no more of Eastern Block to protect weak spots in the Middle East, we can go to a place like Iraq and help ourselves like Thieves to the Black Gold of Iraqi that is already in abundance and doesnt need to be extracted with huge expenses in the prcess of doing it.

However it appears that this Golden Goose is costing the US Taxpapyer $50 Billion a month and yet the US Oil companies are not giving a cent from their profits to cover their ill judge misadventure!

Patriotism starts at the level of CEOs and Major shareholders and to set a good example in the ethics of running a business in a free transparent market not a Mafia type of management where auditing rules are flexible because you happen to have a good NEOCONS network that will ease everything on your behalf from Bush to Cheney to Rumsfeld and their Cronise Cabals Warmongers!

So to sum it up beofre the invasion of Iraq, the price of a barrel of OIl was less than £40. Now after 5 years of WAr in Iraq and unstability in the Middle East thanks to this NEOCONS Agressive behaviour in the area that is thousands of miles away from US shores, the price jumped to mre than 3 times and sometimes in excess of $140.

However if the US Oil companies that were involved in the go ahead of the Iraqi invasion had to pay the US taxpayer for this misadventure, I do not think that their balance sheet will be so favourable to the owners or the Major shareholders of these Oil companies.

THE MORAL OF THE STORY. IN US POLITICS THE DEFENSE MANUFACTURERS AND THE DEFENSE LOBBIYSTS SCRATCH THE BACK OF OILMEN AND THE OILMEN SCRATCH THEIR BACKS IN RETURN.

LOSERS ARE THE ORDINARY US CITIZENS WHO HAVE TO HAND THEIR HARD EARNED TAXES TO THE ONES THAT ALREADY HAVE IT ALL. THIS IS DEMOCRACY!

YOU STEAL A FIST OF DOLLARS AND YOU ARE SET A GOOD EXAMPLE TO OTHERS. HOWEVER WIH GOOD CONNECTIONS, YOU CAN HELP YOURSELF TO THE US TREASURY AND THE US TAXPAYER'S MONEY IN BILLIONS OF DOLLARS AND NO ONE CALL YOU TO ACCOUNT FOR IT FROM HALLIBURTON TO BLACKWATER TO EXXON MOBIL. C'EST LA VIE!(THAT'S LIFE!) LONG LIVE THE EMPEROR BUSH AND HIS NEOCONS DYNASTIES! LET THEM HAVE 4 MORE YEARS THANKS TO THE NAIVITY OF THE MIDDLE AND WORKING CLASSES!

Imarkex:

There is no "blame"for profits.The democrats are to blame for high prices because they wont let the oil companies drill offshore and Amwar.The Democrats in charge of Congress are TRAITORS that will stop at nothing to make the war go bad or the economy .They hate George Bush they dont care what they do to America if they can keep Bush from being successful .

thomas matt:

a bushel of wheat should cost 150.00 toevery country that sells oil

Patrick:

This is the outcome of Vice-President Chaney's energy meeting with the major oil companies four years ago to gouge the American people!

The Bush Administration has kept that meeting secret including the participants as America would be angry to know the profits come from an old oil man and price gouging/fixing by the highest powers in the land.

Patrick

Gary E. Masters:

Who is to blame?

How rude.

One might as well ask "Who is to blame for such poor opinions?"

Profits are good. Especially if seen as a rate of return and not as an absolute sum which shows only scale of operations and not much else.

Anonymous:

Mike

Let us try again.

At 33 mpg that is 100/33 = 3 gallons.

At 43 mpg 100/43= 2.3 gallons.

3/2.3= 1.30 or increase of 30%.

Semantics.

22 is still better than 0%.

_kt_:

Oil prices are high because we are willing to pay them. Oil prices have been low for decades, and this has prevented competing technologies from arising. Now that oil has become so expensive, competing technologies will be able to develop, and competition between these different sources of energy will help to re-stabilize oil prices.

Dan M.:

It's certainly good for a company that outperforms its competition to make a handsome profit. It is the reward for good work. The problem here is that the oil industry as a whole is making huge profits, including EXXON's competitors. So I doubt that EXXON's profits are largely due to its particular competency, but rather an indication that the oil business is not operating as an free market.

In a properly functioning market, oil companies would more often take a loss. Instead, they seem to consistently take profits that are a particular percentage of their operating costs. In different markets (the airline industry for example) you regularly hear of companies going bankrupt. This is as it should be - companies that can't compete go under. But when is the last time you heard of an oil company going bankrupt?

With a wink and a nod, the oil companies charge what they think the politicians and public will bear. With enough muddying of the waters by their political allies, they can and do get away with it!

By the way, yes, Exxon pays plenty in taxes, but this is not a sufficient excuse to gouge the American public. (If you take $2 from everyone and give back $1, you are still stealing $1.)

American consumers are paying the price for allowing too many mergers in the oil industry. EXXON should be broken up. And we need to invest in the development of genuine alternatives to oil, even if they don't truly pay off for another 20 years.

JR:

Compare the price in year 2000 & year 2008, the increase tren is not normal, I mainly point out the TEXAs oil companies and the president from TEXAS. They are the bigest to blame for oil price increase,check the income of Exxon and the rest oil companies.

OfficerMancuso:

Isn't it peculiar to ask who's to blame for what's presumably a good outcome in a society which accepts that protection of private property and giving relatively free play to the profit motive leads to better outcomes than Soviet style government mandated 5-year plans?

"Who's to blame for profits" is sort of an anti-schadenfreude.

Personally, I've been voting by radically reducing my energy consumption. And yeah, I think OPEC are a bunch of pick-pockets - which has given me that little extra motivation I've needed not to turn on the air conditioner this summer even once.

I am certainly not surprised that big American oil companies are raking in the dough under these circumstances, and I'm not particularly upset about it. They do constructive work, unlike OPEC, which grows rich by virtue of an accident of nature. If it had been any more accidental, the Shieks would be getting crude oil enemas.

erika van heusen:

Install a computerized sensor in each and every car which will measure how many people are in the car per mile driven. If a four seater is used mainly by just one person charge the owner $50/Gallon for gas, by two people $30/Gallon, by three people $20/Gallon, by four people regular price.

erika van heusen:

Increase the gasoline taxes so the price will be $10/Gallon. Maybe... maybe... that will help a little to reduce the rampant obesity that exists in America. And, by the way, use the money resulting from that tax increase to develop a civilized-country-type mass transit system.

Fate:

Chesterfield1: "There is no shortage of oil. There is a shortage of Refined Gasoline. See Senator Ron Wyden's report, entitled, The Oil Industry, Gas and Refinery Capacity: More than meets the eye. His report suggests that major oil companies pursued efforts to curtail refinery capacity as a strategy for improving profit margins..."

You are a few years late. That was occurring in 2005 and when Katrina hit and knocked out a few refineries, there was a gas shortage due to refiners taking refineries off line, and gas it $3 per gallon.

Today no gas station is having trouble getting gasoline. Gas is not in short supply. Oil never was. Oil is high because Bush continues to threaten Iran, where a war would really send oil prices high, so the speculators are reacting. bush needs to keep his big mouth shut. If he had done so for the past 8 years we would have been better off all around.

What a disaster we have seen and history will record. Your grandparents probably told you about how they survived during the great depression, and it probably made you stop and think. But that is nothing compared to the stories you will tell your grandchildren about living through the Bush administration, which in just 8 years brought this great country to ruin, and it isn't over yet. I have saved hundreds of dollars by growing my own vegetables and putting my car in neitral going down hills (yes, it really works and increased my gas mileage 4mpg). That will become commonplace by next year. It took 10 years and a world war to get out of the great depression. I can only hope we can get out of this depression (right, not recession) with less destruction.

erika van heusen:

Who is to blame for todays's highway-robbery-type-oil-prices?

SILVIO BERLUSCONI!

Berlusconi's gansters are using too much gasoline to chase the Rumanians out of Italy.

MIke:

Jaxon1:

Nationalize the oil companies.
_________________________________________
WHAT? Somebody slap Jaxon1 back to his senses. What the he## dose the government know about Oil. They can't run congress, fannie mae, ginnie mae,freddie or ANY of the myriads of wasteful and ripe for fraud programs and Departments.
Yes Obama is the ultra liberal Marxist that would like that idea.

Thomas R.:

Gas in Saudi Arabia is $.45 that's 45 cents a gallon.

Every time "W"orst rattles his sword his oil buddies make millions.

"Constipated" Joe Lieberman was a Democrat when he and other senators like McCain sold out America to Enron for campaign contributions (like the rest of congress) ... Now they want to play the good guy and change oil/gas speculation... the very thing they created (people have short memories)...

The problem isn't just Republican vs Democrat, it's MUCH WORSE.

Google : David Cay Johnston

CHANGE CONGRESS
CHANGE AMERICA
http://change-congress.org/

Chesterfield1:

There is no shortage of oil. There is a shortage of Refined Gasoline. See Senator Ron Wyden's report, entitled, The Oil Industry, Gas and Refinery Capacity: More than meets the eye. His report suggests that major oil companies pursued efforts to curtail refinery capacity as a strategy for improving profit margins, Further the report says competing oil companies worked together to subvert supply; that refinery closures inhibited supply and that oil companies are reaping record profits. That report, on page 6, list refineries closed from 1995 to 2001 in an act to inhibit supply. Our leaders are blowing smoke at the American people suggesting that more drilling for the raw material, oil, will alone solve the problem. The supply pipeline can and is easily being controlled by controlling the size of the pipeline from crude oil to refined gasoline. The real demand is for refined gasoline we can burn in our automobiles. The oil companies know this and detract us from the real issue of refining capacity to a suggested need to drill oil wells everwhere on the planet. Big Oil is not interested in solving this problem.

Jaxon1:

Nationalize the oil companies. Oil is the central nervous system of the country. It touches everything we do. Millions of Americans are going to be thrown into poverty unable to keep jobs and eat-feed-cloth their families.

If McCain (& crew) thinks he can balance the budget by continuing tax breaks & curtailing "entitlements" to people, he's even more stupid and addlebrained that imagined.

Welfare & government "entitlements" are not government benevolence, they're insurection insurance. Think about it.

Though I'll bet that McCain continues corporate entitlements-welfare. How much you wanna bet?

Eric Petersen:

How about Exxon's taxes? 49% tax rate in Q2. This year, the company will pay more in taxes than the bottom 50% of all US tax payers. Unfortunately, not all this money will go to the Feds - 70% of Exxon's profits (and taxes) were from overseas. As for the evil speculators, last time I checked the CFTC data the boys were net SHORT.

Nick Batzdorf:

There are a number of thoughtful and informed posts here, but what stick out even more for me is the number of knee-jerk uninformed ones. They point out the problem: there's no competency test when you register to vote (not that I'm advocating there be one, only that there's a problem). As a result our politicians aren't even moving us in the right direction; on the contrary, some of them are using the current situation as an opportunity to institute offshore drilling!

Anyone who thinks we don't need to cut back our energy consumption is deluded. That's not something politicians want to tell us, but of course it's true. Jimmy Carter gets laughed at even by intelligent liberals because of a very successful smear campaign, but the reality is that he is responsible for our appliances becoming way more efficient since the late 70s. It's not his fault that our response has been to use up that savings by having two larger TVs, etc. He was on the right track. (And by the way all you people who laugh at Carter: it was his National Security Advisor Zbigniew Brzezinski's policies that put the final nail in the Soviet Empire and helped us the Cold War. Go do some reading before blasting a great president!)

Anyway, that's where it starts: conservation. But obviously it's going to take a lot more than that, in fact over the long term there isn't a single home run answer (at least not at this point). Even if we all drove motor scooters at 70+ MPG, transportation is only 28% of our oil use.

What we need to be doing is in one sense very simple: investing a measurable part of our GNP on research into our next energy economy. We're going to have to do it sometime, and the longer we wait the more expensive and disastrous the change is going to be.

Unfortunately that's very hard to sell to an uninformed public, as too many of the posts here show.

Robert Wagner:

Why worry about the price of oil?

Rather, worry about the price of gold, corn, silver, wheat, rice, iron, copper, etc.

Eg, worry about supply and demand. To lower prices, you must increase supply, or lower demand.

I suggest that we lower demand.

Alan Browne:

We are to blame.

Free marketers are generally right about profit motive. And that works for anything that is available whether scarce or abundant.

What we are collectively wrong about is the role of oil in the world.

There are really only three things we've clearly understood about oil (and gas) since the 1970's:

1. It is the vital economic lubricant and fuel of the world.
2. It pollutes (getting it, refining it, using it).
3. It is a finite and dwindling resource.

Given those three points the world collectively should have been working very hard to manage oil use over the past 25 years. This does not mean not using it, it means using it much more wisely as well as developing and using alternate sources of energy such as wind, solar, geothermal, nuclear and hydro.

The real failure is government policy. And the failure there is people's indifference as long as they can gas up their cars.

In not very long people will be inconvenienced by shortages and spiraling prices.

The fantastic and deserved irony of GM posting a $15B quarterly loss as Exxon posts an $11.2B profit should make people reflect. But it won't. If you don't get the irony it is this: Detroit and the oil co's systematically did all they could to prevent and orderly and much needed maintenance and improvement on the CAFE rules. In the end, GM and its employees and shareholders are suffering while Exxon and others make record profits.

I strongly recommend "The Long Emergency" by James Howard Kunstler as a somewhat frightening read on the looming realities.

Point is this: oil is not a great energy source but it is fantastically portable and somewhat abundant. The world economy and poor excuses for cities like Phoenix depend absolutely on cheap oil or they cannot exist.

The emergency begun in the 1970's and we ignored it.

sane analysis:

the financial and economic understanding (or lack thereof) shown by some, but not all, on this board is astoundingly stupid, which is not surprising given the publishing company (washington post). To focus on the NOMINAL profit of a company, in this case exxon mobil's 11.68 billion quarterly profit, is totally and completely irrelevant and pointless and says nothing about how "profitable" they are. One must look at profit margin in order to determine the profitability of a company. In other words, for every dollar of REVENUE a company produces, how much goes to PROFIT, after paying costs for supplies, wages, etc... Exxon Mobil generated 11.68 billion dollars of PROFIT off of 138 billion dollars in revenue, for a profit margin of about 8.5%. In other words, for every dollar of sales, only 8.5 cents went to profit. Compare that with apple corporation's 14.9% profit margin and microsoft's 29.2%. Heck, Campbell's soup generated about 14.2% and McDonald's corporation sports about a 19% margin. Now tell me, which company has "windfall" profits?

cody mccall:

Mufson doesn't say a word about speculators. It's been my understanding--more like a fuzzy impression--that those guys have been instrumental in driving up fossil fuel prices artificially. All they have to do is name a 'speculative' future price and--shazam!--there it goes, right up to where they 'speculated' it would go. And they collect their cut. Some job, eh? You want more income? Just say how much and it happens. Isn't it just a little insane we have based our entire economy, entire culture, on an energy source that is non-renewable, gonna' run dry sooner than later, and is owned largely by people who hate our guts. And the Republican solution is to pepper an Alaskan wildlife refuge and our oceans' beach vistas with oil rigs as far as the eye can see to dig more holes. Well, when your PROFIT is $90,000 per minute, don't you want that ride to go on forever? But it won't. It's a fool's temporary approach to a permanent
problem. We have to diversify to renewables. And now, not later. And Exxon Mobile will fight it every step of the way. Who do YOU want to win that fight? If you have kids, it should be obvious.

Robert G.:

Who ever is to blame for oil profits should be given a bonus. That is the job of any company. To make a profit. An if you are the worlds biggest company it would make sense that you make the worlds biggest profit. Of course the Democrats need to be given some credit. There action are keeping oil supplies tight and thus helping the oil companies make even bigger profits.

deeCole:

The price of fuel is a case of opportunity. The oil giants are not governed by any rules concerning price and has only their wealth at heart. Sure they are protecting their investments, by enjoying prosperity, it's all corporate greed. The cost of gas is over rated. These rich men are going to holler in their sleep for the suffering they have caused.

Bob K:

Hey guys, lets mix it up. Everyone with internet and media saavy plant stories about increased production, new discoveries,and new gasoline alternatives. Watch the girlie men futures traders run around like chicken little.
So reactionary, so silly thy are!
Yet their every little fit effects us all!

Oil Companies are Innocent?:

No matter what the reason for their profits, the fact is, their prices are endangering the wellbeing of people all over the world. Since they don't want to lower their prices worldwide, perhaps they could channel all that profit into digging wells throughout Africa, or even improving the condition of their leaky oil tankers and pipelines.

Mike M:

Jay -

While I'm all in favor of slowing down and conserving gas, your numbers are misleading. Indeed your mpg went from 33 to 43 an increase of almost 30%. However if you look at actual fuel consumption [ 100 miles @ 33mpg = 3 gals and 100 miles at 43mpg = 2.33 gals] you'll see that your fuel savings is actually 22% [(3-2.33)/3 x100].

Hello:

As many people have said here, we the people of the world are to blame for ALLOWING to hold us all hostage over oil.

Over the last month we've seen what happens when we cut our oil consumption by consolidating our trips, thereby driving less, switching to compact fluorescent light bulbs in our homes, and trading in our land barges for more economical vehicles.

The price of gas at the pump has dropped anywhere from 15 to 20 cents.

How badly does the public want to lower it any more? It all depends on how much lower we want it to go.

And in the meantime we could also start researching a safe, clean, easily renewable source of energy.

Jay:

Consumers are to blame, period.

I just got back from testing a GM HHR that gives an instant readout for miles per gallon.

I drove a hundred miles at 65 mph and my mpg was 33.

I then drove on the same stretch of road for a hundred miles at 55 mph and my mpg was 43 .

An increase of 30%.

Both times I refilled the tank after starting with a full tank to check on the instant readout. It was very close, almost equal.

If we all drove at no more than 55 mph, car pooled one day a week, another 15% reduction in consumption, and worked out of our houses one day a week, another 15% reduction in consumption, our total national reduction in gas usage would be 30 + 15 + 15 = 60%.

That may not bring a 60% reduction in gas price but it would have significant decrease in gas prices so that those of us who earn less will be able to drive to work and keep their jobs.

The President and the Congress are not going to give us any leadership in that direction. It is all up to us to save this country.

MillionaireCafeL.A.:


A study for you all :

K.K.R / TXU

T X U / OiL

Oil / Politicians

Politicians / Big Business

Big Business / Energy

Energy / Oil

Oil / Wealth

Wealth / Power

Power / Control

Control / influence

(must spread the influence, how?)

Information / Media

Media / Marketing

Marketing / sales

Sales / buying

buying / profits

profits / greed

hedge funds, wall street, speculators

Oil = cartels = criminals = greed = K.K.R

This is just "one" study of oil profits, how they are made, continue to climb, and the shadow organizations behind them. The same goes for our congress - People buying people to place in certain strategic positions to support a mission.

Do you realize that hedge funds and private equity firms such as Blackstone are specifically the type of businesses that are depleting the great spark and love affair we have in starting and maintaining American Business, the creative business mind, and core love that fuels our drive to present the world with our own expression.


Research:

People like Barry Diller, Icahn, Soros - these are the heads of the enemy, yes the tyrants who are screwing us with their EGO's, yes sickening people who are simply nothing but money scum.

Just follow the background on these people, people like Sheldon Adelson in Vegas, or producers in hollywood - connected to to dirty money..

Now this is all just my opinion...., do your homework.

dwight:

eco activists want high tax prices, dems want to tax oil more wanting high gas prices...after all pelosi went on vacation giving the voters the finger...we should give it to her by voting the dems out...

jschmidt:

We have a supply demand issue and all the numbers show it.Supply is the problem and you can look at the world supply /demand tables, http://www.eia.doe.gov/emeu/ipsr/t21.xls
2005 Supply 84.63 Demand 83.65 Average
2006 Supply 84.60 Demand 84.62 Average
2007 Supply 84.52 Demand 85.37 Average
Exxon sells a lot of gas and that results in record profits. The industry average is 8.5% profit as a percent of sales. Windfall profits tax advocated by Obama was tried in the 70s and resulted in less supply which will on;y drive up prices. The majority of Americans ,74%, want offshore drilling to be allowed.Along with the 2 trillion barrels of oil locked in oil shale that Shell says can be processed for $25 per barrel with less environmental effects than producing ethanol, oil supplies produced in the US could increase. If it had been done in 1981 when the Democratic Congress prohibited offshore drilling, the oil would already be in the pipeline. Also their are currently 8000 lawsuits against oil companies drilling on currently leases filed by environmentalists. But Congress will do nothing about that because there are more environmental lobbyists in DC than oil lobbyists and the environmental lobbyists give to Democrats. So Obama should learn something about oil before he fires off against McCain. SOme experts believe if we allow drilling offshore to start, prices will come down now.

http://money.cnn.com/2008/06/06/news/economy/birger_shale.fortune/index.htm

http://fossil.energy.gov/programs/reserves/publications/Pubs-NPR/40010-373.pdf

http://www.rep-am.com/articles/2008/07/20/news/354852.txt

http://www.usatoday.com/money/industries/energy/2008-07-22-oil-tuesday_N.htm?POE=click-refer

http://www.businessweek.com/magazine/content/08_27/b4091075505012.htm

http://www.usatoday.com/money/industries/energy/2008-07-22-oilmarketbill_N.htm?loc=interstitialskip

http://online.wsj.com/article/SB121486800837317581-email.html

Time Out:

Our energy issues are not rooted in any one political party, business enterprise, group of individuals, or any such thing, and trying to assess blame is just keeping us from addressing the fundemental issues.

It's time for an intelligent discussion on the topic, not a litany of conspiracy theories that distract us from deveoping a solution. Enough of the finger pointing and angry rhetoric.

Our nation was built around abundant and cheap energy ... that has certainly changed as conventional energy sources have become more scarce and cost has risen dramatically. We need to face this changing reality and make appropriate, long term changes to our infrastructure and our way of life. It's not a taboo topic to change our way of life; Americans have made such huge adjustments before ... remember the industrial revolution? It's just time for another change.

So, let's have some intelligent discussion and open our minds. That's the first step on this new journey.

Ronny B:

The biggest piece missing from this article is the fact speculators have driven up the costs, there is no classic supply and demand equation here. Certainly demand has gone up, but to the degree where prices have increased over 200%? That is ludicrous.

During this war in Iraq oil traders have raised prices for things as little as a bomb going off that was wholly unrelated to actually impacting the system, there are even some well funded "terrorists" in Africa attacking production facilities, I'm certain they are not paid by any nation-state oil companies to fire off a couple of RPGs and scrounge up a headline or two...righhhht.

To write an article that doesn't even touch on the speculators and describe the machinations where they buy a future price in a barrel and then sell that stake to someone else who in turn raises that future price and sells it and so on and so forth illuminates the wacky world that benefits speculators and oil companies, of course the oil companies are going to be silent about that practice, and use it to their advantage to ask for more offshore oil permits, when the facts are that they already have many permits that they aren't even drilling on already. Let's get some transparency, and above all depth to these fluff pieces, we the reader deserve it.

Bob Thompson:

'we are' posits a valid point. The question I have is which presidential candidate offers 'we the people' the best chance to start correcting some of the conditions in which we have gotten ourselves.

We, the people, need to get control of the political situation in this country. One thing I would truly like to see is some strong term limits to stem the sense of career and the corruption that exist today.

WE ARE:

I hate to say it, but "We the People," for electing a party into office that lays in bed with Big Oil and Big business and allows them to govern our elected officals. What I want is for American to vote McCain into office to continue the Bush legacy which is killing off the entire working class population. The model of a free market society that Republicans have injected into the veins of government has paralyzed our government to fix or control any damage to this nation and I was the American people to suffer until the entire nation places this party in front of a firing squad to return us back to, "We the people" and not "We the Rich."

Bob Thompson:

I do believe the only resolution to the false concepts held by the ignoramuses who consider our American way of life not worth having will be a series of lessons coming through the 'Jimmy Carter Institute of Giving Up'.

Only thing is, Carter's approach includes giving up many of the comforts we are used to enjoying. And I have not seen any inclination to sacrifice by those who predominately support these political concepts. Barack Obama is already beginning to enumerate some of the 'consumption abuses' Americans are engaged in and things we should cut back on or give up.

I think it is a fact that many, if not a majority, of Obama supporters have no knowledge of the silliness that went on in the seventies, both in foreign policy and economics.

JimBob:

Having spent over thirty years as a laborer, engineer, and executive in the petroleum and petrochemical industries, I am amazed at how fact-challenged most of the comments here at the Washington Post.

Most of the comments here are the wild imaginings of the utterly ignorant.

the flaw in the "profits are good" mantra:

Yes, indeed, profits are good. They are the lifeblood of our financial existence.

However, we don't worship money, or at least some of us don't. The bottom line is having a shared prosperity for all as a nation -- with a quality of life that makes life worth living. To what end any economic system if not for that? We only go 'round once in life.

We're genetically disposed to be greedy. It's part of our id. Caveman stuff. That is the lynchpin that makes markets work.

Unchecked, this greed, with power apportioned according to who, primarily by birthright, has amassed the greater wealth, wield that disproportionate power to further feed that greed, and always at the expense of those who have lesser power.

Now if that's the kind of economic Darwinism that floats your boat, either because you're operating under some fantasy that someday you'll be one of the powerful, or perhaps you already are looking down your nose at the rest of us with smug disdain while you greedily run your fingers through your stacks of coin, well, hey, that's all your own business. But I, and about eighty percent of Americans who agree we're on the wrong track, don't happen to see much use in a society like that.

Yes, profits are good; windfall profits for an essential of life are not. Ever-increasing wealth disparity is not.

Services essential to life should not be "for profit." Fire departments, police, the military (well, until Bush took office) -- none of these are "for profit" and that's for a reason. They are vital to our very existence as a community.

I'm starting to wonder whether providing fuel should be thought of in similar terms, a thought brought about solely because of their egregious profits, and something I'd never have countenanced until now.

Instead of nationalizing the oil companies, I'd be just as satisfied with a mass shift away from consuming fossil fuels, and hitting the oil companies right where they've been lying to us since the Carter administration to avoid being hit: right in the pocketbook.

We're not used to living like third-world nations, and it's gonna be a tough situation once enough people are living in the discarded appliance cartons outside the latest McMansion development out West. We better figure out how to do something differently than we've been doing, and fast.

So if you like having an economic gun held to your head, just keep defending these robber barons and pretend you're getting rich because some pension fund you're in may hold oil stock. If you're sick of this bullpucky, well, use less fossil fuel, and then use even less tomorrow.

Matt Jones:

This reminds me of a line from Sympathy for the Devil, by the Rolling Stones:

I shouted out, "Who killed the Kennedys?"
When after all, it was you and me

If you are reading this, then you are probably as much to blame as anyone. Most people who read English consume enormous amounts of oil to support our lifestyle. Major oil companies are simply responding to supply and demand. They don't make the oil.

Blame yourself, and quit looking for a whipping boy. Then get serious about conservation and pray that we have time to bring alternatives on line before we run out of oil.

Roy:

Cheney and his cronies believe American consumers have STUPID stamped on their foreheads.

Here's how it works:

- manipulate the cost of crude to incredible levels

- use this as an excuse raise gas prices in turn while failing to build more refinery capacity

- gas goes from $2.50 per gallon to $4.50 per gallon

- lower crude and drop gas down to $3.80 before the Presidential election to make it look like the administration did something about it.

- keep prices there or above even if crude falls later

- sit in the White House and large corporate palaces and smirk at joe-six-pack who is now complacent and happy that gas is back to $3.80.

- enjoy windfall profits from taking gas from $2.50 to $3.80

- throw some bones to Republican politicians who will hiss "SOOOO?", look the other way during more market manipulation and let big oil begin drilling wherever they want without regard for the environment

- rinse and repeat

hmm, how many times have they done this in the past? Maybe Americans do have STUPID stamped on their foreheads, especially if they vote for four to eight years more of the same.

Klem Kaces:

Obviously Emmanuel Goldstein is behind our high oil prices.

Mark W.:

First off, the government ought not concern itself with profit unless those profits damage society like inflation to recession.

Commerce is another function of government like trade imbalances. This is a huge trade imbalance. Can't blame the Japenese being smarter than we are in producing cars that are on average more fuel effienct than American manufactured cars, again more trade imbalance. Look at the chemical industry being affected as well due to high fuel costs. The obvious is independent truck drivers which are acutally small business owners, free spirits of commerce.

Nothing changes when nothing changes. The Bush/McCain energy policy is Voodoo. It does not to relieve current gas prices and the winter heating season is just around the corner, a lack of foresight.

Bankers are being ignored on this one as well. As speculation devalues the dollar on global currency markets. That means that Billions are lost through excessive speculation, pirates that hold paper, temporary assuming ownership of Oil and Natural gas until it can be dumped off for profit. Just too many middlemen doing economic damage on a global basis.

In addition, montoring the Senate very closely, I saw a pretty chart showing some 70 million acres of Leases out right now. Only a small fraction are actually producing raw materials on a domestic basis. Over 50% have not been explored to date. Significant is the portion explored and ready to go for production about 25%.

But, if certain parties want to continue to play rovian politics that is on them. Today, as usual, the President did not take responsibilty for this current recessionary trend. He must have an old school oilman principle which is boom to bust economics. We are lead to assume that is the way it is in the oil industry and I am not buying it. This method of capitalization extreme to Houston, Tx. becoming a ghost town overnight has history.

So there are "fixes" to be implented immediatly but his comfort zone is politics as usual. Voodoo Energy policy matches Voodoo Economics and Voodoo Accouting like that enron deal. It is a misnomer that these principles are enlighted indeed. In fact, knowing Bush, offshore drilling is one of his legacy needs ignoring the general populus in crisis just like that Katrina thing.

Hank:

This is simple math folks. If Exxon Mobil only raised the price of gas to compensate for the rise in the price of crude, their "profit margin" would have stayed the same, at about 4 to 5 billion a quarter, but it didn't. It more than doubled, which means that Exxon raised their profit margin by over 100 percent as well. In english that means they're gouging the crap out of us. They wallow in record profits, while the rest of the country and economy is hurt. They don't care who else goes out of business, as long as they get to milk the cow to death.

surlydoc:

WHY IS OIL SO HIGH.
ANSWER:
THE CARLYLE GROUP, GEORGE H.W. BUSH, JAMES A BAKER III, THE SAUDI ROYAL FAMILY (OF WHICH OSAMA
BIN LADEN IS PART OF), GEORGE W. BUSH.

THAT ABOUT DOES IT. THERE ARE PROBABLY ABOUT A DOZEN OR TWO OTHER INDIVIDUALS AND FIRMS INVOLVED.
THEN THERE ARE THE SECOND TIER OF INFLUENCE SUCH AS HALLIBURTON AND DICK CHENEY WHO BENEFIT FROM
THIS CORRUPT SYSTEM.

Amazed:

"Who's to Blame for Auto Makers Losses?"

Ans.:

Obviously, the short-sighted and self-serving American public and their craven politicians who lack the courage to confront long-standing U.S. demand/supply realities along with the urgent national necessity to reduce our net out-payments on energy account.

The continuing American obsession with targeting an immediate reduction in the price of gasoline at the pump as the only litmus test to the validity of a policy proposal only perpetuates policies which are responsible for our present national crisis (and the near bankruptcy of the once proud American auto industry.)

Americans must accept the continuation of higher pump prices if the auto companies have any hope of long-term survival and they must also reduce sharply their decades of gasoline waste.

Further, every domestic source of energy must be exploited including wind, solar, and alternatives.

In the meantime it is urgent that the increase in foreign claims on this economy be terminated or at least very sharply reduced as we work our way back to a sustainable trading position.

We can act to reduce the net outflow on energy account if Americans are willing to face facts and accept the need for appropriate personal sacrifice.

We now have the option of either making this adjustment more or less on our own terms or we can delay and refuse to act until an implacable market forces us to act under emergency/crisis conditions.

Needless to say a House Leader who adamantly refuses to allow members to even debate energy policy and instead chooses to turn our the lights and happily send members on vacation (again) in the face of our urgent need for new national energy policy is the last action one expected from a responsible Democrat majority.

Pelosi's action obviously is based on cold political calculated self-interest and is a clear measure of her reading of the wishes of a majority of the American people.

Pray God She Is Dead Wrong and suffers the consequences and not just the American people.

thetruth:

"To get this windfall, the oil companies didn't have to conspire with the Bush administration to start a war in Iraq. They didn't have to conspire among themselves to raise prices at the pump. If you own oil anywhere in the world, you didn't have to do a damned thing. Just close your eyes, make a wish, open them, and - surprise - you're getting an extra $25 a barrel. "

This is no different from what happened to realtors, mortgage brokers and others working on comission during the housing bubble. Why were you not calling for a windfall tax on such REIC scum at that time?

This is just double standards .....

Mike:

Aaron Taliaferro: Wrote this stupid crap...

Who to blame for oil profits -- what a stupid question.

Profits are good. Every mutual fund owner, pensioner, trust fund, and 401(K) across the nation benefit -- and that is a lot of us.

I am always slightly amazed that people have a problem with high profits. The profit margin remains in the normal range for oil companies -- revenues are high because the oil price (set by supply and demand which only OPEC can really affect) is high. Higher revenues = higher profits but the margin remains the same.

No one is outraged that Microsoft's margin is well over 20% -- where is the indignation. This is such a ignorant argument.

Profits are good

I am writing..
What a dumb comment the above is. Sure profits are good but not at the expense of the common man. Sure let exxon MAKE THOSE BIG PROFITS at the same time let those profits come at the expense of draining your struggling mother and grandmother dry at the pump or in home heating oil. What a stupid comparison of Microsoft and EXXON. Even if Microsoft starts selling all software at triple prices it would still not be an accurate comparison. Maybe when software becomes a commodity then when can talk about a comparison.

Fate:

Jason wrote: "The price of oil will drop if the offshore is opened up."

It takes 10 years to explore and set up the rigging to produce what oil may be there. Speculators are not concerned with oil 10 years out. They are concerned with oil next month.

Jason wrote: "Bush lifted the executive ban and the price of oil dropped $10."

He also stopped threatening Iran with impending war. The biggest thing affecting speculators is the oil supply next month and a war in the gulf would really threaten those supplies. Talk war and the price goes up. Stop talking war and the price goes down.

Jason wrote: "Over the past few weeks the price of oil has continued to drop as House Democrats faced increased pressure to allow the Republican sponsored energy bill to come up for a vote."

So just a possibility of a vote is causing the price to drop? No. The price of oil is high because two years ago Cheney started talking about war and Bush started talking about taking out Iran's nuclear program. The price of oil has doubled since then with no decrease in supply. As Bush and Cheney keep their big mouths shut about war, the price will continue to drop. If either mentions war again, check to see what happens to the price the next day.

Jason wrote: "Drill now, lower prices now."

Drill now see the oil in 10 years. You could open up the entire continental shelf and nothing would happen to the price of oil tomorrow. Now if Exxon and others said they would start pumping from oil wells they have capped, then you might see oil go down, but why would they want to drive down their own oil prices?

You may see an emergency that this nation needs to address, but Exxon and others see things as being just fine. They are not loosing money, just the opposite, and if they did anything to make the price of oil go down they would loose money. No, big oil considers the current situation to be just fine. They are not sweating as their record profit shows. Next time you listen to republican lies do a little thinking. Its actually helps when listening to these people who will lie with a smile on their face. Opening up the shelf is a long term strategy with long term effects, not short ones. Exxon of course cares about its long term profits so they want this to happen. But they also know the price of oil will be just as high after a vote to open it up. They are not stupid, but they know most people are, and so they lie, their lobbyists lie and the politicians who are in their pockets will lie too.

The question is are you someone who just listens to the lies and takes them as true, or do you think for yourself and analyze the situation? A small amount of thinking about this shows much of the drilling talk about dropping oil prices is lies. Think for yourself and question authority.

Packard:

Blame for oil profits? Excuse me?

Since my retirement portfolio and pension fund both own significant positions in big oil and their profits, I would certainly not use the word "blame" to describe something that is now making me money.

It is like asking who is to blame for Bill Gates or Warren Buffet being multi billionaires? Both questions are silly. Moreover, they also reveal a deplorable sense of economic envy.

Packard

Aaron Taliaferro:

Who to blame for oil profits -- what a stupid question.

Profits are good. Every mutual fund owner, pensioner, trust fund, and 401(K) across the nation benefit -- and that is a lot of us.

I am always slightly amazed that people have a problem with high profits. The profit margin remains in the normal range for oil companies -- revenues are high because the oil price (set by supply and demand which only OPEC can really affect) is high. Higher revenues = higher profits but the margin remains the same.

No one is outraged that Microsoft's margin is well over 20% -- where is the indignation. This is such a ignorant argument.

Profits are good

Jason:

Maxfli @ 8:50,

Intersting article reference but it does not mention the futures market, where oil is traded, and, subsequently, sets the price of oil.

I disagree with the nlotion that the idea of future supply would cause oil companies to produce more oil. The futures market argument is that the potential for more supply in the future will affect the price now because of the expected future supply.

The price of oil will drop if the offshore is opened up. Bush lifted the executive ban and the price of oil dropped $10. Over the past few weeks the price of oil has continued to drop as House Democrats faced ncreased pressure to allow the Republican sponsored energy bill to come up for a vote.

Drill now, lower prices now.

Fuddanabi:

to Robert Craig:

Oil speculators are traitors?

Better call in and have the FBI arrest your financial adviser because chances are your retirement plan is profiting from oil speculation and oil companies.

You and your financial adviser can then visit each other in the soup line after he gets out of prison.

Shaun Will:

Who's to blame for oil profits?
Who's to blame for high car/truck prices?
Who's to blame for high cost of homes?

We are because we want a bigger salary when salary goes up so does EVERYTHING ELSE.
If the oil companys has huge profits what about the federal goverment with a eighty cents tax per gallon?
Where is my tax break?

Fuddanabi:

I reject the headline as yet another indication that the Washington Post and its writers would apparently rather live in the 1950s U.S.S.R. than in the U.S.

"Who's to blame...for profits?"

The question is immoral. Everyone, and every corporation, has a right to make as much legitimate money as they can under our system.

Let's not join the whiners yelping over having to spend $100 to fill their SUVs when we pay some of the lowest gas prices in the world. Thanks to the oil companies.

Give it a rest, Red Post.

maxfli:

Essay on Bush/McCain claims that offshore drilling will quickly lower gas prices:

Offshore Drilling Claims Are a Political Hoax: John M. Berry

Commentary by John M. Berry


Aug. 1 (Bloomberg) -- It's absurd to argue that ending the moratorium on drilling off parts of the U.S. coasts would quickly bring down the high price of gasoline.

This chimera is being touted by President George W. Bush and other Republican politicians, including the party's presumptive presidential nominee, Senator John McCain of Arizona, to deflect blame for what it's costing for a fill-up.

To get around the fact that it would be a decade or more before any oil would be likely to flow, a few partisan analysts have said that the cost of gasoline would fall right away. They argue that the prospect of additional oil supply in the future would lead oil companies to produce more oil immediately because they would expect prices for crude to be lower later on.

Well, wouldn't that depend on whether a producer had the capacity to pump more oil today, and whether it thought lifting the moratorium would add a significant amount of oil to future supply relative to future demand?

There are good reasons to question whether another 1 million or 2 million barrels of crude a day would make much difference in prices when world consumption is running at 85 million barrels a day.

About a fourth of all U.S. oil production is already coming from offshore wells, primarily in the central and western portions of the Gulf of Mexico that aren't covered by the moratorium.

In a May 2007 forecast, the Interior Department's Minerals Management Service, which oversees exploration and drilling on the outer continental shelf, said that oil production in the Gulf was likely to increase from 1.3 million barrels a day last year to about 2 million barrels by 2010.

Ignored Forecast

In other words, production was expected to rise by about 700,000 barrels a day over a three-year period. That would be a gain of about 14 percent over the 5.1 million barrels produced daily last year in the U.S.

Yet somehow that sort of forecast based on industry projections and announced discoveries had no discernable impact on world crude oil prices.

Why would anyone assume that opening other coastal areas -- which may or may not harbor large quantities of oil that might or might not be economic to produce sometime in the future -- will have an immediate impact on today's oil prices?

Nevertheless, the assertions continue: lift the moratorium and gasoline prices will fall. And since McCain's Democratic opponent, Senator Barack Obama of Illinois, is opposed to ending the moratorium, he therefore is responsible for high gasoline prices.

Dry Holes

Drilling proponents point to an estimate from the Minerals Management Service that there are probably about 76 billion barrels of oil waiting to be discovered offshore.

The problem is that little of that oil -- perhaps about 18 billion barrels -- lies in areas subject to the moratorium. A third of the total is off the coast of Alaska, where drilling is extraordinarily difficult and expensive, and most of the rest is in the Gulf of Mexico where drilling is permitted.

Some 3.5 billion barrels in the Minerals Management Service estimate are off the Atlantic coast in the Baltimore Canyon, an ideal geologic formation in which to find oil. It runs from east of Cape Cod all the way to North Carolina.

Beginning in the late 1970s, huge tracts were opened for exploration and oil companies jumped at the chance to drill. About 35 wells were sunk off Cape Cod, New York and New Jersey at a cost, including purchases of the leases, of almost $3 billion.

The result? Nothing. Neither oil nor gas was found.

Giving Up

Another ideal formation, the Destin Dome, in the eastern Gulf Coast area off Pensacola, Florida, was another major disappointment. Exxon Mobil Corp. spent heavily to acquire leases and found no commercial quantities of oil or gas in what became known as ``Dusty Dome.''

Years later, natural gas was found in the Dome. Yet, as a result of political pressure generated by environmental concerns, oil companies were paid to give up their leases. The gas has never been produced.

At a July 15 press conference, Bush said that he had lifted an executive order that had restricted offshore drilling since the early 1980s. Now, he said, ``the only thing standing between the American people and these vast oil resources is action from the U.S. Congress.''

Fooling the Public

Republicans are hoping that the public, believing their foolish claims that drilling will lower gasoline prices, will put enough pressure on Democratic opponents during the August congressional recess that begins today to pass legislation to end the moratorium this fall.

Meanwhile, both Bush and congressional Republicans have refused to take a step that really could reduce gasoline prices. That is to release a portion of the light, low-sulfur crude in the U.S. Strategic Petroleum Reserve.

In an earlier column I explained why that action might bring down prices in a way opening more environmentally fragile coastal waters to more drilling can't. Obviously Bush, McCain and their allies would prefer to mislead the American people and escape blame for effects of their past lack of action on the nation's energy problems.

trippin:

Who is to blame for oil price gouging?

We are.

If we reduce gasoline consumption, the price will drop. It's just that simple.

The trick is to not go back to our gluttonous ways like we did after the energy crisis during the Carter administration. But we are a piggish lot, so don't bet your next paycheck on that one (assuming you have a paycheck.)

Had we heeded Carter's advice the last time, we wouldn't be in this crisis. So now it's a reprise of the same, and we seem to have collective amnesia, or perhaps are just a bunch of slow learners.

Again, we're being told there's no hope to wean ourselves off oil, so drill, drill, drill.

And if we do, it becomes a self-fulfilling prophecy until the next time and gas goes from its current $4 level to double yet again.

So every time someone promulgates this drilling nonsense, it should be followed by a disclaimer: "I'm Big Oil and I approved this message." But make no mistake: we have met the enemy and he is us. Only we can wean ourselves off oil -- the powers that be in both parties are powerless to do so even if they were so disposed, which they are not.

kim:

Look in the mirror. We are responsible. I live in a major metropolitan area with two large cities and I couldn't take mass transit bus or train to work if I wanted to due to the lack of vision on political leaders to plan ahead. Go to the end of your driveway and count the cars in your neighborhood. The lousy oil companies are just reaping the profits, we are the one who have created this mess.

brian mcc, the arctic:

Money is a drug, oil the black tar heroin of the pharmacy. Bush is an admitted addict. He has merely replaced 1 substance for another more potent source. McCain is a user, Obama is just now getting a taste of that sweet poison.

Many battle cancer, 1 in 3. A very small % of patients do not respond to morphine.

It's like being left-handed.

Bill Mosby:

And profits deserve "blame" for what reason?

In the most recent year, the 6 major oil companies listed the following performance:

Exxon-Mobil: Revenue 359 billion, earnings 40.61 billion, 11%
Royal Dutch Shell, 356, 31, 8.7%
BP, 284, 20.8, 7.3%
Chevron, 204, 18.7, 9.2%
Conoco Phillips, 172, 11.9, 7%
Total S.A., 188.8, 18.2, 10.4%

Total for all: 1.56 trillion, 141 billion, 9% profit.

From quarterly results earlier this year, Apple Computer had a profit of 1.6 billion on revenues of 9.6 billion, or about 17 percent. For Hewlett-Packard, it was 2.1 billion on 28.5 billion, or about 10 percent. For Google, it was 1.25 billion on 5.37 billion, or about 23 percent.

And finally, the medical-industrial complex has revenues of about 2.5 trillion dollars per year. Profits- anybody's guess. I would guess they are pretty healthy, too.

Just a little perspective. Why not tax windfall medical profits, windfall computer profits, and while we're at it, windfall food profits?

Because it would be as stupid as it sounds. So too with calling oil company profits "windfall", because they are really not out of line with those of other industries.


indeparty:

Who did what to whom? The was a study a year or so ago about one of those famous car chases in Los Angeles where the police chased a deranged motorist down route I5 just before rush hour. The chase lasted nearly an hour because the police didn't want to close in and hurt anyone. They sensibly waited until he was out of gas. The police had to close off some forty exits and entrances on the I5 freeway and this backed up cars in all directions for much of an hour. The overhead news choppers were imaging all of this and later begin comparing pictures. Some students begin carefully counting the cars near the ramps and came up with a reasonably accurate figure of 2200 cars idling near the ramps. In hot weather, that would amount to a gallon and a half burned by each at around $4.00 per gallon. Not counting choppers and police pursuit vehicles, that comes out to 3300 gallons wasted by one man on drugs. Multiply the idling waste by maybe 60 cities a day.

If there are 800 billion barrels on earth (current absolute estimates) and the Human Race consumes 212 billion barrels every ten years, will the price of oil double every ten years?

dnjake:

Well what about all the people who insist on driving around in those gas guzzling SUV's. People like to see their homes go up in price. What did they do to earn that? Over a long time, the US as a whole has insisted on spending more than we produce. That factor has a lot to do with the current shortage in commodities. There are undoubtedly complexities. But supply and demand is still the basic pattern. Liking to get $120 for a barrel of oil does not do you much good unless you can actually sell the oil. If someone else, is satsifying demand at $100 a barrel, your price will have to go down.

roboturkey:

We built an entire culture enslaved to the internal combustion engine, totally dependent on strategically vulnerable, depleting, fuel sources.

We have no concept of self-discipline over the use of fuel and even now are trying to rationalize continued fuel usage on demand.

We have shown no will to adapt behavior to increasing fuel prices by choosing slightly more inconvenient means of transportation and heating.

Of course it is the fault of the US consumer. As soon as an individual adapts his or her behavior, that person's cost for fuel drops dramatically in almost exact proportion to the steps taken to limit fuel usage. If you begin riding a bicycle, the cost in gasoline for your daily trips drops to zero. If you insulate your home to reduce usage of heating fuels, you experience another proportionate drop.


Until those steps are taken by an individual, they must share the blame.

CRETIAN:

GOP REPUBLICAN US TREASURY ROBBERS: Your apparent preference for the presidency of the United States of America, nor his democratic myrmidons in the US Congress, have any right, whatsoever, to be allowed to destroy the financial health of any publically or privately traded company here.

That is your solution, Obama's, and the likes of the party to which you subscribe. Exxon Mobile is leading the world in R&D regarding advanced polymer films to improve/extend electrical battery life and performance for hybrid autos and electrical cars. So, you and Obama want to take that money and re-distribute it, right?That means you will take my dividends, along with millions of other stockholders, away from us, right? And you are going to force us to do it because your going to get our government to take it all away.

That makes you, Obama, Pelosi, Reid.... a Marxist, a Socialist, and a theif. You've got to be a complete idiot to believe that we are just going to quietly stand by an let you get away with robbing our wealth without a fight. An absolute knock down, drag out total dog fight. There will be blood on the floor.

Amazed:

The vast majority of comments here lead one to an inevitable conclusion:

1. The only way that EXXON can satisfy these critics is to continue to buy crude at the market price --now only $125 per barrel down from a recent $147 a barrel--and then sell gasoline for say, $1.50 a gallon.

Obviously that is the socially responsible thing for management to do and while shareholders might object that this means the company will go bust, the socially responsible and knowlegeable folks here will see through this devious argument immediately: the answer they will quickly say is don't worry EXXON can easily make it up on volume since they are a monopoly.

2. Every one who comments here and is a citizen of these United States (and apparently in some jurisdictions even when you happen to be an illegal alien) will have a vote in selecting my next president.

Tocqueville' and others worst fears seem amply justified now. The U.S. is a mobocracy.

Pace Thomas Jefferson and Patrick Henry and George Washington

nallcando:

The fallacy here is that oil is a free market. The oil industry is, in fact, an oligopoly, where a small number of suppliers control the price. They set the price based on what the market will bear, not based on their costs of production, which is why the price of gas seems so irrational, and why the oil companies are making hundreds of billions of profits annually -- price competition is not in play. The Republican argument that a windfall profits tax would cause prices to rise doesn't hold water because the oil companies' tax rate only affects cost of production, which doesn't really affect pump prices.

If the oil companies were socially responsible, they would be investing their excess profits on clean, renewable energy. Congress asked nicely for them to do this a couple of years ago, and they scoffed. So now they have to pay the consequences of short-term thinking and irresponsible behavior. If people who need financial help are beneficiaries, good. If renewable energy R&D is a beneficiary, even better.

Even if we drilled in every wildlife refuge and put a refinery in every back yard, we would not be able to make a dent in world oil demand nor, ultimately, oil prices. As Pres. Bush said, we are addicted to oil. The idea that we should "solve" the problem by drilling for more is like telling the addict to go find another vein, and while you're at it, light up another joint to fill the room with greenhouse gases.

Air Car:

What I want to know is WHY the floundering behemeth US automobile manufactures and the floundering US government is not desperately trying to license the compressed air engine from the Luxembourg-based company MDI... which has successfully developed a compressed air powered automobile (Google Search: Air Car). This engine runs on cheap compressed air.

The cars will come to the US and India next year, but only in small quanities...possibly 10K units produced by start up companies. Why is this? Where is the US auto industry when oil dependence is destroying their business. Where is the US government when dependence on oil is destroying our economy, creating run away inflation, destroying businesses dependent on cheap fuel, and worst of all destroying our national defense? You can't fight a war with machines dependent on energy you don't have any.
It is in our national interest to produce automobiles and military vehicles that do not rely on Oil.

My guess is most of this columns readers have never even heard of the compressed air engine. I'm sure big OIL wants it that way... and maybe big US automobile manufactures too. Shame on their outrageous greed. Forget Sadam's weapons of mass distruction. OIL dependence is our enemy's best "weapon of mass distruction".

Why can we send billions of government dollars to Islamic countries... but when it comes to spending money on new technology that will free us from the binds of OIL... nothing. Come now, you can't say you were surprised with the oil shortages... this all started in the early 70s. This country has had 35 years to deal with this problem... and has done nothing. There is a reason... the oil lobbies.

Decide today that you will purchase an air car when they finally manage to get to the US market. Decide you will never buy OIL from the people that have controlled this country for years.

Chaotician:

How's this for an idea: The oil companies need to have more land to drill; for America to have more oil; which erronously would become cheaper by some miracle of world economics not yet explained.
Now the oil companies need tax subsidies to justify drilling for more oil; so, lets just cut out the middle men like the OPEC countries do; take back those pesky 68 million acres not currently being exploited; hire these oil companies for a flat mangement fee; and let any oil "profits" flow to the owners of the oil; namely the American people! Everybody is happy right? The oil companies have no risk; the American oil will actually be used to support America instead of the multi-national oil companies crying "poor me"; and Congress can decide which oil properties to exploit!!!

magellan1:

The oil companies are still pumping oil from wells drilled years ago. Wells that were also bought and paid for years ago. The costs to lift oil from some of these wells is probably less than five dollars a barrel - you do the math. In other cases, the oil companies are using more expensive techniques to coax oil from these old wells, like high temperature-high pressure extraction. Costs to lift a barrel of oil from them are higher, but still well under the going price of oil. Then you have the increasingly higher costs for wells drilled today, tomorrow and beyond. You can bet that any decision to drill new wells depends a lot on the direction of the price of oil, i.e. expectations for return on investment.

Is that wrong? If you think so, ride a bike or invent a viable electric car. Opportunities are boundless!

paul taylor:

..."And no one points the finger where it belongs, which is OPEC."

Maybe there is a little blame to go around.

Why, during recent elections (and this one in particular, when the Republicans need a strong shot in the arm), do gas prices at the pump go down? Even when, as now, the oil prices per barrel go up?

If no one can find the ghosts who are doing these mischievous deeds, then the ghost busters will have to come in on this case.

Whost to blame for oil profit?:

The consumer of course. Because they are dumb enough to buy gas guzzlers, live in the suburb and drive their car.

Gary E. Masters:

Blame. Of course I know all about blame. As a child I knew whenever I made a mistake, I would look at the closest person and say "Look what you made me do." Later on I moved to "Look what you did." Both worked and I was started on the blame game.

However, blame is like an excuse. The best excuse in the world is less than one good success.

We have higher prices. That will pay for the new infrastructure we will need for other energy sources. Once established, these energy resources will become more efficient and cost less. Then we have lower prices.

Then someone can come in and say "Look what I did."

That is called the Credit Game.

Anonymous:

Umm, why is it considered a radical idea to try to limit one's consumption of a product in order to save money?

I mean, it's like complaining about the BG&E rate hike. I knew it was coming. I don't LIKE it, but I planned for it and I'm not taking a huge financial hit.

We've all known for a long time that oil isn't limitless, it can't be. Most prices rise over time.

Let's give the engineers, etc. credit for brains and creativity and encourage them ($$$) to come up with even better solutions. In the meanwhile, we can exercise self-restraint.

Al:

Look... its real simple. The reports that the press runs are about the total net profit for the oil companies. What is failed to be mentioned by the "big oil" haters is the amount of tax that these companies are paying each quarter. For this second quarter, Exxon had to pay $32 Billion in total taxes for its revenue. Taxes are based on revenue brought in, and the total revenue that is earned by the companies is based on the price charged. And the price charged is related to the futures prices of a barrel of oil on the world market.

Also, what is Exxon's profit margin? and what has it been for the last 3 years for each quarter end. Because if that profit % has not increased significantly, then there is nothing here to yell and scream about.

If there is any blame... then blame the newly industrialized countries of India and China who are now utilizing far more world oil stocks than they did a decade ago. That demand increase causes a decrease in the supply capacity of the pumping nations, and if no one else adds more pumping capacity... expect oil prices to rise like a balloon.

Get off your duffs folks... its not a conspiracy. If it was a Bush conspriacy, he would have already arranged Oil prices to dip below $50 so republicans can win in Nov. The ball is in Congress's court to do something with the energy policy of this country.. and I don't think the current leadership will make those changes. Poor economy for the party out of power will always help their chances for taking power.

How childish are you people?:

When your racking up billions every quarter and prices keep rising what in the H#ll do you call it, business as usual? If the federal government raise taxes on everyone and end up with a surplus of revenue to handle this countries needs, our own government is labeled corrupt. What the world is witnessing is pure greed. Exxon oil has enough off shore property on record to continue drilling for over twenty years and they are drilling everyday in down town LA in enclosed building hidden from the public's view. As far as production, Exxon alone could have started two new facilities on line, but here is the rub; Wall Street. The company cannot operate within the norms because shareholders are looking for irrational results which is driving the price of oil to a breaking point that will hurt this country beyond repair. It is time to regulate the corruption that is taking place or revert back to the gold standard and shove Wall Street and its cronies behind bars. As for me and my advise to all Americans, pull your money out of Wall Street which includes your 401k and any other retirement backdrop you are carrying and cut the strings to Wall Street. Corporations like Exxon will be made to finally operate as a company and will end our economy from spinning out of control due to the greedy ba5tards Wall Street has spawned.

DANY:

Before you try to bite the hand that feeds you, look into the mirror first. Who is using the oil? Move closer to work, drive a car with better mpg (and btw JAND do you have those patent numbers your talking about - give me a break). Get off the grid and go independent. Elect local officials that facilitate public transportation - don't look to the federal or state goverement to solve your problems.

Trondlin:

Besides if you think about it, we have to use up most all of the available oil, at whatever the cost is, because we can afford it even if just marginaaly for some. We cannot afford to just walk away from petro, and allow others to have that cheap energy evailable to them! We must use it up...

Amazed:

Steve Baby! Steve baby!

How can you do this to one of your most admiring readers? Just after serving up a truly helpful and informative series on our energy debacle, you offer us this encore of fodder for the demagogues, e.g. Pelosi. Reid. and Schumer, and their mob.

Your first paragraph suggests that size doesn't matter; but I assure you that it most certainly does and especially in this instance.

Why do you and the other industry baiters focus only on net profit? Why no data on aggregate revenues and sum of all royalties, imposts, income taxes, etc. collected from these sales which have brought an almost endless variety of products and services and made them readily available to the consumer as needed and when needed?

Or the fact that sale of shares by shareholders at higher prices along with dividends are again the subject of taxation and so help the fisc?

Is EXXON to be penalized because it is well-managed and efficient-- in sharp contrast to the corruption and chicanery rampant in American banks and financial institutions? No profits there and indeed far less in the past if truth be known and business was done accordng to accepted banking standards.

This did not prevent this incompetent and rapacious management from lootihg their corporations at the expense of shareholders and the market they served.

Do you and many other Americans truly argue that the latter results are to be preferred to those of say, an EXXON? If so we might as well end the pretense and wind the American system up now. And may God help us all.

EXXON is accused of conspiring to boost the price of crude. If they in fact have this power then surely management must have known about plans to do so say eight or so years ago when they decided to rid themselves of marginal producing properties in the Gulf and elsewhere since they were not thought to be worth the expense of continuing to operate them.

The Apaches and their risktakers and others smart enough and courageous enough to take the other side of that trade have benefitted handsomely. EXXON management looks foolish and outfoxed for their failure to hold on to every barrel of reserves.

The decision alone would surely put the lie to allegations that EXXON or anyone else now controls the international price of crude.

Kinsley says the improvement in EXXON's financial status is not due to any particular effort on their part but just to the fact that crude has gone up in price.

Hey, Kinsley wants to play that game what does he have to say about copper, lead, steel, coal, platinum and corn, rice, soybean, etc. etc. producers and growers? They too haven't "done a damn thing". Why no windfall profits tax and castigation of this lot?

If Kinsley and many of the other pundits who are find it so easy and obvious to make managerial calls for the energy business would just devote more of this wisdom and skill to management of the print media then surely the financial condition of the press would be readily improved.

And Mr. Hakes and Jimmy Carter on energy. Now there is a pair to conjure with indeed.

I will be happy to send Mr. Hakes of a letter candidate Carter sent to the then Texas governor assuring him that the price controls on natural gas would be lifted as soon as he reached the Oval Office. Carter reneged on the undertaking finally redeeming it very late in his term.

And don't forget to read the Carter Doctrine regarding the U.S. strategic interest in the Middle East. In brief President Carter reaffirmed the policy of the United States by noting the immense strategic importance of the crude resources of the region to U.S. security and in the event an outside power should ever be a threat to such position, the U.S. would act, by military force if necessary, to repel such threat.

So yes all ye super libs--its all about oil. And until you come up with your version of a Philosopher's Stone for your fabled altlernative energy it will continue to be all about oil.

Be damn glad that you have such as EXXON and their talented management and scientists and drillers on your side. They are a national treasure and are to be applauded not condemned out of ignorance.

Trondlin:

You all have good points, I abhor margin trading, but all trading is speculative to a degree. The real issue is simple supply and demand, about 7.5 years ago someone decided to lower the U.S. reserve from 90 to 45 days and then to 30 and may be less now. So long as the reserve is that small, the oil companies dont have to carry the cost of sitting on that pot. Hence better profits due to less costs. Fill those holes with oil and consumer prices will come down, and a small single event will no longer be such an impact on futures, but why on earth would the oil companies want to make less profit, maybe they will do it to be patriotic... LOL

TJMAN:

I think that this is much to do about nothing. Look at the two biggest exporters of oil in Europe. Norway and Britain. The price of gasoline and diesel in those countries is roughly 9-14 dollars per imperial gallon. We are never going back. There are millions of unexplored acres of land in the US that are open to drilling but have never been drilled. The oil companies want us to open more land to drilling. Hmm sounds a little fishy doesnt it? Look up Ford in the UK. They have at least 6 smallish diesel TDI cars that get over 45 mile per gallon. They do not sell them here in the US. I guess we have to wait until fuel is over $10.00 dollars per gallon to get the super fuel efficient cars here in the US. Ford, GM, and Chrysler are lobbing congress not to raise fuel efficency rating requirements? Who is getting screwed here. Welcome to America, the land of the rich, and the home of duped. The main purpose and function of government is to protect the people from things they can't protect themselves from. Most laws written in the past in the US were measures to somehow protect the population as a whole from some entity. The bill of rights in the constitution is all about individual protections. Is our goverment protecting us? Not from the oil companies and car manufacturers. Goverments job in relation to energy is to protect us from being subservient to foreign entities with respect to resources used to produce energy. We need a government driven program like the interstate highway system in the 40's,50's, and 60's to re-invent the power grid and develop alternative fuels. South and North Dakota covered with wind farms could produce all the energy needed for the country if the energy infrastructure could support it.

AV:

Blame?

Try the prior Clinton and Bush Administrations and a Congress run by political merchants
who approved big oil mergers in the 80's and 90's.
Our illustrious Justice Department who couldn't enforce restraint of trade if they tried.

Monopolies strive for one thing, elimination of
competition. Now we have it, enjoy it while your
money lasts.

Consolidation in the oil business
has not brought about any new exploration effort,
on the contrary it has brought oligopoly and companies who can ratchet prices anytime they want,spend huge sums on stock buy backs to enhance exec stock option gains, pay low dividends, and control marginal supply and growth of oil reserves as well as refining capacity.

But what the heck, the same thing is going on with the big mega and regional banks and eventually you will pay them even more to
keep your money on deposit......

Time for the trust-buster, Teddy Roosevelt to ride back into town.

JanD:

Oil companies bought up all the patents for the innovative non gasoline vehicles in the 70's and 80's because it would put them out of business and today we are paying for it. I am very disappointed in todays unimaginative greed driven America.

E. Carreras:

Let's see:

Profits = bad

therefore, it is reasobale to surmise that

losses = good

The Washington post must be very good!

See "Washington Post Co. Reports Second-Quarter Loss of $2.7M"

Keep up the good work WaPo.

Lemurah:

Fight the system from within.
Take your money out of oil and consider putting it in solar. Feel good about investing & making money & help shape the future.
Everyone wants electric cars now, and they are already coming to market. Car companies are losing money by making gas-guzzlers, so they're not gonna make any more. Time to shift focus completely.
You're the consumer, You're the investor/trader/speculator, so make Your decisions with foresight and intelligence.
Where are You putting your $?
and why don't you send any senator who voted 'nay' to extend tax credits for solar an email voicing your opinion?
Here is the web site that shows how every senator voted on S.3335 to
extend the solar tax breaks motion that failed for the billionth time:

http://www.senate.gov/legislative/LIS/roll_call_lists/roll_call_vote_...

Most senators actually take the mail their offices receive very
seriously, so your simple email has power, even though it may not feel
that way.

To write to your senator, go to...

http://www.senate.gov/general/contact_information/senators_cfm.cfm

then select your state and you will get links to email those
senators. Here's an email to Senator Burr, who voted nay. If you
don't feel like writing your own email, use this as a template:

--------------------------------------------------

Dear Senator Burr,

I'm concerned about our dependence on foreign oil, and I'm very much
in favor of encouraging and promoting alternative energy development.
You voted nay on July 30, 2008, to S.3335, and I would like you to
reconsider your position. I believe that this motion would greatly
help move our country in the direction that it needs to go for a long
term energy plan. Thank you for your consideration.

Sincerely,

Your voice here

Forest Hendley:

If exxon made 11 billion. How much do you think the government made in that quarter? Look up windfall profit in the dictionary.

Then tell us who is making a windfall profit.

Bruce Lee:

It doesn't take a genius to conclude that the removal of Saddam and preventing the second largest source of oil in the world from interfering (competing) with largest source of oil in the world (Saudi) allowed price gouging and robber barons to have their way. The oil companies will push the price envelope as far as the public will tolerate. Only when Congress issue investigations on price increases will they (oil companies)back off and begin to justify their prices. Ofcourse we haven't had any investigations under the Republcians for quite some time......go figure.

Ken B.:

If you look at the profits of the oil companies over the last ten years you see it is a nearly linear increase with the cost of the oil itself. They appear to use a fixed markup on the cost of raw materials and pass that along to the consumer. It is in the best interests of the oil companies as they currently operate to increase the raw material cost as that increases the profit they make. The solution to the problem as I see it is to limit the markup per gallon of fuel sold to a specific amount. In that manner in order for the oil companies to make more money they would have to hold down prices to increase demand. Of course the increased demand would also increase pollution and traffic deaths as you cannot have it both ways. The high prices at the pumps do have some advantages that effect all consumers. Also from what I understand there are thousands of wells in the Gulf of Mexico that could be producing oil at this time but are capped. Why are they capped? Could it be to limit supply and increase costs and profits? Why do the oil companies want to drill in more areas if they are not bringing to market all the suplly that they currently have drilled?

Anonymous:

"Roger worte: " Consequently, it makes sense for us to require that our private firms take on additional citizenship responsibilities by way of taxation, thus channeling a larger share of state-sponsored profits into our public treasury."

But, as a consequnce of the windfall taxes, the oil companies stock is devalued. So, the government is getting its money at the expense of the shareholders. Wouldn't it make more sense to tax the shareholders (when the shares are sold) rather than the company?

J P:

Sorry, I feel no sympathy towards any company which transposes greed for profit. Like Exon has done for the last year. This with the full knowledge that so many people are losing their jobs because of their own high prices.
If ever we needed government intervention, know is the time. Expose every one of the greedy bastards by name and affiliation, then turn the oil industry and others when necessary upside down for being the economic terrorists that they have become for being the plague on society that they have become!

Forest Hendley:

With the leadership in congress completely disinterested in the publics problem with fuel prices, not to mention that they do not pay for their gas. We the people give them that perk.

They will not allow for more production in our country. If they did that , and prices fell: which the would. The people would realize that it was their fault all along. Which of couse it is. This is not rocket science, just supply in demand.

Oh, I almost forgot to mention. How much oil stock do you think is in their portfolios?

GOP Republican US Treasury Robbers:

United States Constitution - We the people of the United States


Democrat $24 barrel of oil

DEMOCRAT $1.50 A GALLON OF GASOLINE


Oil was $24 a barrel when democrats left office


A gallon of gasoline was $1.50 when democrats left office


GOP Republicans took office to change oil to $145 a barrel

GOP Republicans took office to change gasoline to $4.50 a gallon


GOP Republican $145 barrel of oil


A gallon of gasoline is $4.50 under the GOP Republicans

Rising Oil Prices Swell Profits at Exxon and Shell

You do the math and decide if Texas oil millionaires warrant investigations to protect the American people.


HOODWINKED
BUSHWINKED
BUSHWHACKED


GOP Republican Wall Street Conspiracy to defraud the American People and steal from the United States Treasury.


GOP Republican abusive power and blind greed run amok to transfer the American economy into the private capitalistic pockets of the super rich who own and run Wall Street.


GOP Republicans are manipulating the market system to make the many (95 percent of American citizens) suffer and serve the superwealthy few (5 percent Wall Street supercapitalists).


GOP Republicans McCain-McBush III Trillion Dollar War Crisis


GOP REPUBLICAN WALL STREET MILLIONAIRES ARE PAYING THEMSELVES $10,000,000 BONUSES FROM MONEY STOLEN FROM THE UNITED STATES TREASURY, WHILE SENDING OUR AMERCAN JOBS OVERSEAS. RECKLESS OUTSOURCING IS DESTROYING AMERICAN MANUFACTURING AND THE AMERICAN ECONOMY.


No more GOP Republican lies, conspiracies, and grand larcenies.


GOP Republican $155 barrel of oil speculations
GOP Republican $175 barrel of oil speculations
GOP Republican $195 barrel of oil speculations
GOP Republican $215 barrel of oil speculations
GOP Republican $235 barrel of oil speculations
GOP Republican $255 barrel of oil speculations


GOP Republican $4.50 a Gallon Gasoline speculations
GOP Republican $5.00 a Gallon Gasoline speculations
GOP Republican $5.50 a Gallon Gasoline speculations
GOP Republican $6.00 a Gallon Gasoline speculations
GOP Republican $6.50 a Gallon Gasoline speculations
GOP Republican $7.00 a Gallon Gasoline speculations


When does it stop if ever?


GOP Republican Wall Street Greed Speculation does not work.
GOP Republican Wall Street Greed Speculation is hurting America.
GOP Republican Wall Street Greed Speculation is hurting our constitutional rights.


Stop GOP Republican Wall Street oil speculations today


GOP REPUBLICAN Oil addiction has become the new crack drug and we better get off soon


GOP REPUBLICAN WALL STREET MILLIONAIRES ARE PAYING THEMSELVES $10,000,000 BONUSES FROM MONEY STOLEN FROM THE UNITED STATES TREASURY, WHILE SENDING OUR AMERCAN JOBS OVERSEAS. RECKLESS AMERICAN JOB OUTSOURCING IS DESTROYING AMERICAN MANUFACTURING AND THE AMERICAN ECONOMY.


Nationalize U.S. Oil For National Defense.
Nationalize U.S. Oil For National Defense.
Nationalize U.S. Oil For National Defense.


Clean nuclear electric energy is the answer


We the people of the United States.


BARACK OBAMA WILL bring back our United States Constitution and Rights of the American people. Who is better to save the country than an Ivy League United States constitution professor who loves his country more than GOP Republicans love ill gotten Wall Street speculation money.


GOP REPUBLICAN WALL STREET MILLIONAIRES ARE PAYING THEMSELVES $10,000,000 BONUSES FROM MONEY STOLEN FROM THE UNITED STATES TREASURY, WHILE SENDING OUR AMERCAN JOBS OVERSEAS. RECKLESS OUTSOURCING IS DESTROYING AMERICAN MANUFACTURING AND THE AMERICAN ECONOMY.


Stop GOP Republican McCain from selling our America.


This remarkable unleashing of deep Democratic energies went hand in hand with clever GOP Republican efforts to subvert the will of the American People, whether by overt corruption or covert manipulation. This corruption or manipulation resulted from the widespread market activity that was incompatible with the good of the American Public. American Citizens were well aware that the voices of the People could be offset by powerful GOP Republican market elites bending the system to serve the interests of the few. The economic power of the GOP Republicans was recognized to be the primary source of Wall Street speculators’ corruptions.

Democratic dialogue was motivated by opposition to the market–driven greedy GOP Republicans obsessed with obscene quantity of moneymaking with little regard for the quality of the Public’s Democracy. Democratic love of wisdom was contrasted sharply against the GOP Republicans love of money.

Impeach the defunct GOP Republican Party of Wall Street Super Rich Thieves for milking our country the way wolves milk cows. America deserves intelligent and honest leadership demonstrated by scholars who love America, Americans and Our Freedom. America the Beautiful belongs to All Americans and will no longer be the plaything for Wall Street Super Rich GOP Republicans wolves.

Fate:

Jim Henry wrote: "When did it become wrong to make a profit? The consumers worldwide are to blame for the high oil prices. To lower the price of oil, all that needs to be done is reduce comsumption."

To hear you talk it sounds like a simple supply/demand issue. But are you having trouble getting gasoline? Are gas stations stutting down because they cannot buy gas? Are refineries shutting down because they cannot get oil to refine? Are prople driving more gas efficient cars because they are having trouble finding a gas station that is open?

There is no oil shortage or gas shortage. Supplies on the market have not changed. It is not a supply/demand issue. Just clear that republican smokescreen out of your head.

And if it were a supply/demand issue, Exxon would not be making huge profits but would instead probably take a hit. I mean, are they really paying $130/bbl for the oil they buy? No. Are they selling oil pumped in the US overseas at $130/bbl? Yes. If we allow them to pump oil from new wells will they refine that in the US at a lower cost? No. Will they sell that oil in the US? No, the oil currently being pumped in Alaska is being sold to China. Drill more and more will go to China.

McCain is an idiot and Bush is an enabler. History will show the oil companies have taken us for a ride, like Enron did, while our republican government tells us lies as to what is really happening.

Roger:

Windfall profits tax makes a lot of sense for two reasons. First, if the market price is driven higher by the actions of state-owned oil companies (the majority of oil companies), those high prices are benefiting the citizens of those states by pouring revenue into their national treasuries. Our private firms are reaping the profits created by the actions of those state firms, but without the public responsibilities those state firms bear. Consequently, it makes sense for us to require that our private firms take on additional citizenship responsibilities by way of taxation, thus channeling a larger share of state-sponsored profits into our public treasury.

Second, the longterm objective of a windfall profits tax would be now what it was in 1979: to signal that "the party's over" and promote a reduction in the price of fuel. That is, the ultimate goal is not to raise revenue, although that is a perfectly legitimate goal (my point #1), but rather to place a disincentive on high fuel prices. As a society we would probably rather have the broad, generalized savings of cheaper fuel than the more narrow, specific treasury savings that windfall profits tax revenues would produce.

TimL:

Henry,

Unfortunately that will not work. Because there is a monopoly on petro and it is required for nations to function reducing usage will not reduce costs. What will occur is the price will go up as "demand" decreases. They do this to compensate for their loss.

At this day and age Petro/Gas is a required substance that we cannot live without. It is more important than the food you eat because the food you eat would not make it to your plate without it.

jpv:

Profit is a good thing and the objective of all for profit companies. Record results are a good thing for oil companies and investors.

Whom ever is responible - they are doing a great job! With so many companies (GM, etc. and even one Sate - CA) loosing vast sums of money, I'm glad someone doing thier job. I know where to invest my money.

Jim Henry:

When did it become wrong to make a profit? The consumers worldwide are to blame for the high oil prices. To lower the price of oil, all that needs to be done is reduce comsumption.

Fate:

jakeblaine wrote: "The difference between a speculator and an investor is a very fine line..."

I agree, but the problem is not that anyone is investing or speculating, the problem is how they are doing it. You can buy stock with your own money and take a risk. But many buy stock with borrowed money and so the borrower takes on some of that risk making the investor/speculator less worried about a loss. Both types of investors will reap the rewards but they will not equally reap the loss. That is the problem.

Some commodities require some amount of your own money to be put up. Houses for example are sold to people who are required by the borrower to put up 20% (or get insurance to cover a potential loss for the bank). But oil speculators are under no such requirement since SEC rules do not require it. You can go out today with no money in your pocket and buy oil and if its price drops walk away. That is not how it should be done. The SEC needs to level the playing field for investors/speculators. Forcing those who speculate on high risk ventures to put up more of their money will remove them and bring sanity back to the market.

But we are under a republican administration. Our republican president considers Wall Street to have gotten drunk on speculation. You would think he would consider this bad and implement reforms, but no, getting drunk on other people's money is the republican way of life, so in his mind its just the hangover after a good time, and what republican wants to stop a good time? So while homes are being forclosed upon, homes in wealthy areas are having additions added. You see, republicans consider the current economy to be good. You only need to hear Phil Gramm say that its all in our heads to understand how these people think.


Steve:

You think a president from Texas, who has a huge family business on this thing, will allow you to lower the oil price in any meaningful way? Dream about it.

Mike Brooks:

You must think we are a bunch of idiots. Just quit insulting us, okay? Anyone with a computer and the least bit of competancy has known for months that about half of the present price of gasoline is directly traceable to commodity traders running an Enron like scandle. They are presently doing exactly the same thing with food and metals. So don't act all surprised when the price of food and just sky rockets this fall, okay?

Now, it may take a few more minutes, but it is well worth the effort. Go back to the internet and identify those traders by name. More than a few of them were a part of the Enron scam! Oh, and well over half of them *WORK* for oil companies!!!! So, the oil companies have it both ways. They can blame the high cost of fuel on "speculators" while the "speculators" can blame the high cost of fuel on oil as a raw material. You know those groups of guys with a table on the street in front of your office running that con where you have find the pea under the walnut shell? Same thing!

jhope432:

Considering that the profit is denominated in the US Dollar, which has lost 95% of its value since the Fed was created, the profit is not all that much.

Lynnsee P.:

http://www.storyofstuff.com/

we need to act fast

Michael Francis:

There is only one group of people that can change this and that is the american consumer. Drill every where that has a drop of oil that we can control go to the artic circle and stake ouir claim. This will buy us time to take on natural gas,wind,solar and coal.I think this needs to be treated like a war not a crisis,treat it like we did in world warII. Sell energy bonds instead of war bonds. Set a dead line when the U.S will cut its oil dependance by 50%. That alone will crush the current oil market. This will spur growth and new industry. Second go to the american auto mobile makers and make a deal, tell them who ever comes up with afforable technology in the next two years that they produce a electric car to go 200 miles on a single charge at 80 miles per hour and the federal govt will give that producer a 50billion dollar tax credit. That then cause a rebirth of the american autio industry. It can be done the consumer has to demand it and demand it now.

jakeblaine:

The difference between a speculator and an investor is a very fine line...

It doesn't take much empirical research to realize what is taking place regarding world declining oil extraction rates and the lack of new discovered oil fields to take up the slack. How much value is the U.S dollar worth in light of a way of life based on cheap oil based energy becoming much more expensive and scarce?

JG:

"Capitalism on the way up and Communism on the way down"

Chinmay Nadkarni:

This situation may be exactly what is needed for this country to get its act together and make the switch to alternative energy sources. There is a vast amount of research capacity in the US to discover alternatives that are usable and economically viable, all they need is a nudge in the form of some public investment and other incentives.
Of course, all said this is not going to be a seamless transition, there will be pain. However, if we do this now, it will safeguard the future of several generations to come.

Bob:

If big oil companies had greater access to the 85% of global oil supplies controlled by inefficient state-owned companies . . . . the world probably wouldn't have an energy shortage and oil prices would likely be significantly lower.

In other words, prices are high because states have cut off the initiative of profit.

"Who's to blame for oil profits?" is a tilted question implying some sort of entitlement to the working capital being risked by other people. Unbelievable. Wow.

Bob

Mark Jacobs:

Income - Expenses + Profits. For profits to increase the amount of money (income) has to exceed the amount of money going out (expenses).

It seems obvious to me that since Exxon/Mobil has set another record for its quarterly profits that the price they charge for their products(gasoline) is going up faster than the cost of their raw material (crude oil).

Sean N.:

To ROBERT F. CRAIG

In times of high Prices speculators would push the price down by short selling.

(And the biggest speculators are governments - who buy in times of excess supply, driving up prices, to fill their reserves).

chris:

read The Prize for a little more background.

lester Schlesinger:

It's the oil speculators playing their game. These recent wild moves are not about supply and demand. Why won't people talk about this real culprit?

ROBERT F. CRAIG:

ALL PEOPLE SPECULATING ON OIL FUTURES AND BASICALLY AGAINST THE US, SHOULD BE TRIED FOR TREASON AND PUT IN JAIL. ALL THE POLITICIANS SHOULD CONTRACT AIDS FOR ASCREWING ALL THE CITIZENS AS LONG AS THEY HAVE. AMERICA IS DESTROYING ITSELF FROM WITHIN.

PostGlobal is an interactive conversation on global issues moderated by Newsweek International Editor Fareed Zakaria and David Ignatius of The Washington Post. It is produced jointly by Newsweek and washingtonpost.com, as is On Faith, a conversation on religion. Please send us your comments, questions and suggestions.