Tag Archives: Exxon

Oil Companies -Tax Subsidies

May 12, 2011   Oil Companies-Tax Subsidies
Oil executives and senate democrats battled it out today, on why oil companies should receive subsidies or free money in a recession where gas prices at the pump are at $ 4.00 a gallon. It is political theater to show the public the government really has put oil companies on alert for stern austerity measures in a country that is sinking in debt.

The hearings had an air about them similar to the British petroleum where government has no power and the corporations dictate the rules of the game.  Totally a waste of time of course oil companies will continue to get subsidies and of course they will ream the customer by price gouging and of course there is no oil shortage.

These big oil executives were in attendance:

Exxon Mobil, represented by Rex Tillerson, Chairman and CEO

H. Lamar McKay, Chairman, President of British Petroleum-BP America

John Watson, Chairman and CEO of Chevron Corporation

Marvin Odum US President of Shell Oil Company

None of these men conceded that they were gouging Americans, there was no real shortage of oil and some even threatened to move jobs away from The United States.   The US economy is in such a weakened state that the statements from these men were similar to a threat or blackmail to the government.  The message was: ” if you raise out taxes, we will move our rigs elsewhere”.


Not only are these men responded to the question whether it was  “Un American” to reduce the tax breaks they get since they were on camera.  The Un-American-phrase that came up during the hearings due to a statement made by one of the oil executives to the presss.

These men are a vindictive lot and without regard of destroying the US economy and it’s recovery they protected their corporate tax breaks.

In fact the attitude of these large oil corporations is one of greed and profiteering with a captive audience, a situation similar to a junkie and a drug dealer, the junkie being American car drivers.

The anger from the public of the price gouging at the pumps will be reflected in their consumption habits, with many of them keeping their cars parked in the garage or taking a bus to work and maybe even riding a scooter to work.

Domestic Drilling will Not Reduce Prices at the Pump

If you follow the theory of these oil companies, they state that prices are dictated by the market and supply and demand.

Allowing more oil production on US soil will not change that market demand or prices at all, therefore more consumers are being fooled by domestic drilling promotions by republicans who led the charge to more offshore drills.

Republican Newt Gingrich was one of those politicians who promoted more offshore drilling even suggesting off the coast of Florida’s beaches in the past few years.  This was his policy driven goal before the BP Oil spill of 2010 and then he went into hiding about his statements.

Sarah Palin is another one who promotes more oil drilling namely because her husband’s former employer was British Petroleum.

For some reason, the consumers have been brainwashed to believe that if domestic drilling is increased here in North America that gas prices would come down. This is a scam.

If you look at how the oil companies are producing oil from the Canadian Alberta oil sands and ask a Canadian what they are paying at the pump, it does not matter if production is increased the oil companies will continue to post record profits while charging $ 4.00 to $ 5.00 a gallon to Canadians.

The people of a nation are to share the resources of that country and frankly no corporation likes to share it’s profits with people who helped them earn their billions each year.

The hearing was called to explore all options on eliminating oil, gas tax breaks to help the deficit.  Regardless of having an industry pointing a gun to your head the hearing will accomplish nothing to change prices, only a mass campaign of not purchasing gas for a few weeks.  It could drop prices greatly if Americans got real about driving their 15 foot SUV trucks all day long.

Senator Chuck Schumer said subsidies to oil companies rob Americans of their fair share and those same tax breaks should be going to education.

Democrats from oil producing states are likely to agree with republicans on not banning subsidies to oil companies. Everyone is in it for some skin.

The 36 billion dollars in profits in the first quarter of 2011 alone combined to show that big oil does not need a tax subsidy, and comments from the CEO’s were not all that heartwarming to consumers. When prices go back down at the end of the summer, the consumer will not be complaining and this happens year to year.

In the first Three Months of 2011 The First Quarter Profits are:

10.7  billion for Exxon Mobil
6.3 billion for Shell
5.3 billion for Chevron
5.5 billion for BP Oil

It is all about Wall Street gains for the wealthy on oil and gas stocks and corporate profits for big oil and the consumer is paying the price as usual.

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New Find of 4.3 Billion Barrels of Oil in North Dakota

The recent calls for offshore drilling by the Republicans and big oil companies such as Exxon, are are far less audible now that oil prices have plummeted due to a deep economic recession. The bailouts have squelched all calls for “drill baby drill” because oil is now cheaper.

But is the US sitting on its own oil reserves and the theory used twenty five years ago was to buy foreign oil because it was cheaper than producing our own. At some point this thinking is now outdated when the prediction of $ 300.00 a barrel for oil is predicted in the near future.
That is after we recover from the deep recession due to Wall Street excesses on credit swaps and derivatives.
Since April 10th the Us Geological Survey Office of Communication issued their findings of large oil assessments in North Dakota and Montana.There is an estimate of up to 4.3 billion barrels of oil that remains recoverable in an area called The Bakken Formation. They are recoverable by today’s technology and only 105 million barrels have been tapped since 2007 in the Bakken Formation. This area has the largest reserves of oil than any of the other states and is considered a “continuous” oil accumulation meaning the oil is spread throughout the geological formation.

The findings would not only provide needed jobs in the area but the Bakken well can produce for over 40 more years. It would certainly be less expensive to drill for oil in oil fields than to drill on the ocean floor to greater depths.

Over five assessments units (AU) all confirm the Bakken Formation which include the Bakken Formation, the Elm Coulee-Billings Nose, the Central Basin-Poplar Dome, the Nesson-Little Knife Structural, The Eastern Expulsion Threshold and the Northwest Expulsion. A number of wells produced oil from three of the assessment units.

The questions remain why did the US import oil from the Middle east rather than develop the US findings and drill for oil within the US?

Another question is why do the oil companies and the Bush administration call for off shore drilling in prestine waters such as off the coast of Florida a high tourist area, rather than drill in North Dakota and Montana?

Yet another question is why drill in Alaska which is over 1,000 miles to the major cities of the US which would require an expensive pipeline to be built through a foreign country and over 10 years to build it?

In the long run green energy or renewable energy is the preference and worth the cost investment. If these options were developed 20 years ago, we would not be in this energy crisis today.

Source: USGS National Assessment of Oil and Gas

TAGS: USGS, National Assessment of Oil and Gas, Drill in North Dakota, US import oil, Bush administration, Republicans, New Find of 4.3 Billion barrels of Oil in North Dakota, Exxon, big oil companies, offshore drilling, energy, oil, assessment units, Bakken Formation, Alaska, expensive pipeline, Elm Coulee-Billings Nose, Central Basin-Poplar Dome, Neeson-Little Knife Structural, Eastern Expulsion Threshold, Northwest Explusion.

John McCain’s Pimping for Oil Campaign

Fact: Today 50 percent of US oil production is being shipped to foreign countries.

 

John McCain’s uninformed policy on drilling for more oil in our deep oceans, the Arctic, and developing more coal energy will have no effect on gas prices. The Bush administration’s own analysts have determined that adding offshore drilling would only provide 150,000 barrels of oil in the decade of the years starting in the year 2020 and will not impact prices until 2030. That is in 24 years from now which will be too late for any impact on gas prices today.

 

Currently the crisis is energy, and with the Bush administration’s expenses on military security topping 500 billion dollars this year only 1 percent is being spent on energy security. The grim prospect of Thomas Fingar who is the top US Intelligence analyst predicts military strength will be the least important goal compared to the acquisition of water, food and energy.

 

Republicans that pursue the call for offshore drilling is in any energy bill are doing the public a great disservice and will halt any chances of a by-partisan bill to renewable energy power.
The drill baby drill cries of John McCain in his stump speeches although getting applause from Republican audiences is a windfall for big oil companies like Exxon and Chevron.

 

These companies will receive the rights to drill in public lands all in the name of stopping our need for foreign oil. But will this reduce prices here in North America? No it will not because Exxon and Chevron ship more gas and diesel fuels to other countries which they will continue to do.

 

While these companies suck up more of our oil they will ship it overseas and at market prices to China, Russia, and anyone who will buy it including terrorist’s countries that do not produce oil. If the American voter thinks that drilling here in our country will help reduce prices they are sadly being mislead by John McCain and his big oil Vice President Sarah Palin. It seems there is contradiction in his ticket as Sarah Palin promotes drilling in ANWR in Alaska and John McCain opposes it.

There are betting people that assume McCain will be for drilling in ANWR very soon due to Palin’s popularity ratings. The political game assumes more importance than the consumer woes in gas prices at $ 4.00 a gallon, to which this ticket seems indifferent. There is no economic strategy or benefit in McCain’s call for more drilling except to big US oil producers.

 

Reuters Report-Oil Company Exports
 

Reuters reports that Exxon, Chevron and big US oil companies ship 1.6 million barrels of our oil per day and out of the country. Over 50 percent of our oil is being exported to countries such as: Mexico, Canada, Singapore, Brazil, and Chile.

 

In fact from last year 2007 US oil producers have increased exporting our oil by 33 percent to foreign countries. 

If big oil wishes to help reduce gas prices here in the US why then are they increasing shortages here by shipping overseas? This totally baffles most economic analysts that if you want to increase supply you would normally provide it to your own country.

Facts on John McCain’s Campaign Slogan – Drill Baby Drill

 

1) Drilling more oil domestically will not improve gas prices domestically. The oil companies will continue to sell at the world market price which is over $ 120.00 a barrel.

 

2) The Saudi oil barrens can at any time increase prices of oil by reducing production as they have been using this method to keep oil prices high.

 

3) If the Saudi’s reduce their production it will be a continuation of high prices if you look at it from an economic standpoint “it will still be supply and demand”.

 

4) There is no clause in any new energy bill provided for Congress that will include lower prices for domestically drilled oil, it will still be sold at high prices and it oil will continue to be provided to foreign countries.

 

5) If big oil companies want to drill domestically they must provide guarantees that our oil will not be sold to foreign countries, and it will be used only for our consumption. 

The Bush administration has made the case that it was against US oil staying here in our own country thereby giving licenses to big oil to export our own oil for profits at market levels, way above $ 100.00 per barrel in the coming years. It is of no surprise that big oil wishes to increase their production for their own benefits.

 

For the consumer it would mean the same price levels that we currently experience at the whims of big oil. It does not make sense to make campaign promises that do not hold water and for John McCain’s astuteness he has the economy all wrong.
His slogan “drill baby drill” is simply that – a slogan and Sarah Palin is also spouting the same rhetoric in her speeches. Sarah Palin has granted us an interview with Charles Gibson on ABC news which will reveal her policies hopefully in detail on oil drilling in Alaska.

 

McCain’s energy plan will not change the US based oil production being shipped to foreign countries and he is misleading the public to win an election.


Tags: drill baby drill