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* The “revolt” by congressional Republicans over energy prices is getting some media play…
Continuing with their guerilla tactics from last week, House Republicans will be back on the floor Monday to talk gas prices, even though Congress is in recess, and they may stay there all week. […]
“In an urgent memo sent to GOP Members and staff Saturday (“A Call to Action on American Energy”), Republican Leader John Boehner (R-) and Whip Roy Blunt (R-Mo.) hailed Friday’s action, and encouraged House Republicans to return to the Capitol beginning Monday morning to help keep the historic effort going,” said a press release just released by Minority Leader Boehner’s office. […]
Republicans felt they got a lot of good press out of Friday’s “revolt,” so they will be back at it again, and younger GOP lawmakers were clearly energized by the tactic, something not evident among Republicans for most of the 110th Congress
* And, right on schedule, here’s a recent news release from Congresscritter Peter Roskam…
Congressman Peter J. Roskam (R-IL) will return to the floor of the United States House of Representatives today to seek an emergency session of Congress to address the impact rising gas prices have on American families. Congress adjourned Friday for five weeks without a vote on solutions to lower gas prices. […]
The unscheduled Monday return to Congress comes on the heels of more than 48 Members of Congress staying past adjournment on Friday. […]
More than 30 Illinois 6th District constituents will have the once-in-a-lifetime opportunity to sit on the House floor and witness Congress in action.
Roskam will then host a round table discussion with his constituents to discuss how rising energy prices have impacted their family.
* Let’s hope Roskam and his constituents will discuss a shocking new report. It turns out that lately we’re exporting half as much gasoline, diesel fuel, etc. as we’ve been importing…
A record 1.6 million barrels a day in U.S. refined petroleum products were exported during the first four months of this year, up 33 percent from 1.2 million barrels a day over the same period in 2007. Shipments this February topped 1.8 million barrels a day for the first time during any month, according to final numbers from the Energy Department. […]
The 1.6 million barrels a day in record petroleum exports represented 9 percent of total U.S. refining capacity of 17.6 million barrels a day.
However, with refiners operating at 85 percent of capacity during the January-April period, the shipments represented a much a larger share of total U.S. oil products produced.
The exports were also equal to half the 3.2 million barrels of gasoline, diesel fuel and other petroleum products the United States imported each day over the 4-month period. […]
U.S. gasoline shipments in April averaged 202,000 barrels a day, the most for the month since 1945, when America was sending fuel overseas to ease supply shortages in other countries during World War II. Gasoline exports in April 2007 were almost half at 116,000 barrels per day.
According to the article, the largest share of our exports went to Mexico, Canada, Chile, Singapore and Brazil.
* And then there’s this…
In the last four years, the Bureau of Land Management has issued 28,776 permits to drill on public land; yet, in that same time, 18,954 wells were actually drilled. That means that companies have stockpiled nearly 10,000 extra permits to drill that they are not using to increase domestic production.
Further, despite the federal government=s willingness to make public lands and waters available to energy developers, of the 47.5 million acres of on-shore federal lands that are currently being leased by oil and gas companies, only about 13 million acres are actually “in production,” or producing oil and gas. Similar trends are evident offshore as well, where only 10.5 million of the 44 million leased acres are currently producing oil or gas.
Combined, oil and gas companies hold leases to nearly 68 million acres of federal land and waters that they are not producing oil and gas. Oil and gas companies would not buy leases to this land without believing oil and gas can be produced there, yet these same companies are not producing oil or gas from these areas already under their control. […]
Proponents of opening additional lands to oil and gas leasing assert that vast quantities of oil and gas are closed to energy development. In fact, according to the Minerals Management Service, of all the oil and gas believed to exist on the Outer Continental Shelf, 82% of the natural gas and 79% of the oil is located in areas that are currently open for leasing.
None of this stuff is being debated in the media or by the Republicans. Just the “Drill here, drill now” slogan.
* Related…
* ‘Major discovery’ from MIT primed to unleash solar revolution - Scientists mimic essence of plants’ energy storage system
* Americans drove 9.6 billion fewer miles in May 2008 than in May 2007
* Yesterday’s Revolution Was Not Televised
posted by Rich Miller
Monday, Aug 4, 08 @ 11:50 am
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I can’t beleive C-Span did not cover this. Were they showing the Cubs victory or the Sox fight instead? It is C-Span, what else should they be showing?
Comment by Wumpus Monday, Aug 4, 08 @ 12:00 pm
Great stuff Rich. Thanks.
Comment by JohnnyC Monday, Aug 4, 08 @ 12:08 pm
I laugh every time I read about this 47.5MM acre business. The assertion rests entirely on the assumption that every acre leased, by virtue of its being leased, contains accessible oil. And the amount of said oil can be extrapolated from the amount of oil found in the larger surrounding area. Silly season, yes.
Unrelatedly, in the past when we’ve talked about the rising crude price, I mentioned that it ought to rise until demand gains some kind of elasticity (not that this my novel theory or anything.) Fortunately, that’s finally happened…people are using less.
And all this time, instead of playing around with mpg mandates 20 years from now, debating where to drill, rebates, etc, we could tax the heck out of gas and get a much cleaner result. People respond to incentives…whadayaknow.
Comment by Greg Monday, Aug 4, 08 @ 12:08 pm
Well, it makes for good press, but let’s be realistic: does anyone honestly believe that having a president, vp, NSA and other top administration officials who were high-placed oil executives has been BAD for the oil industry???
What a coincidence that gas prices go insane in the year prior to that oil friendly administration going bye-bye. Looks more like they’re grabbing what they can before their protectors leave. Then, even after they’re forced out, we’re left with a situation in which we’ll NEVER see $3 a gallon gas again. The “market” will be blamed.
Everyone keeps chirping about drilling and how more domestic production will lower gas problems. The problem with that is that the oil companies charge the same price for a gallon drilled in Texas as they do for a gallon drilled in Saudi Arabia, purchased at a profit to the Saudi’s, shipped by sea halfway across the world, etc. Please.
We do need more domestic production, but we have to stop allowing the gas companies from treating gas a commodity and charging for gas on hand the higher daily rate of oil as a commodity. Simple recipe for unconscionable windfall profits at the expense of every American.
Comment by Snidely Whiplash Monday, Aug 4, 08 @ 12:09 pm
Wow thats shocking news! I have seen a few isolated report before about how oil and gas companies hold leases to federal land and waters that they are not producing oil and gas. But seing that its 68 Million acres!!! The media really needs to get this ino out there. With McCain and Bush demnading that we sell more leases to the oil companies, I think it is critical that they are not usuing what they have!!! Increasing the available leases is just letting big oil lock up and control more supply!!! Opening up more drilling off shore or otherwise is really just a tool to help big oil companies control the supply and limit production!
They need to start pulling the leases that are not being producded. These could be re-sold for money AND could come with the reuqirment that they be drilled to also get production going.
Also a ban on exporting until the crisis in under control would be far more useful then offering up more sweetheart leases to the big oil companies.
Comment by Ghost Monday, Aug 4, 08 @ 12:12 pm
Oil isn’t everywhere. You can’t expect that oil will be found on every lease.
You DO know don’t you that the lease EXPIRES if not used? In other words, it goes away. WHo lets oil go away if it’s there? Esp at $100 a barrel!
And, of course, how many of those “non used leases” are tied up in environmental lawsuits?
I am sure that would be close to 100% of off shore leases.
Comment by Pat collins Monday, Aug 4, 08 @ 12:13 pm
Snidely, you can charge the market price, you can subsidize like Venezuela or the Middle East, or you can heavily tax like Europe.
So you want to start subsidizing gas? Just when demand starts to fall?
(And don’t cheat; you can’t charge less without subsidizing; otherwise it would just sell elsewhere)
Comment by Greg Monday, Aug 4, 08 @ 12:14 pm
And since WHEN is exporting a value added product bad? It OFFSETS our costs of importing?
By this measure we should import MORE cars from Japan and Korea, and make less.
Comment by Pat collins Monday, Aug 4, 08 @ 12:15 pm
you forgot to mention the american petroleum institute’s admission (via its president on one of the sunday morning shows: this week or, possibly, mtp) that they don’t have the equipment available to drill more holes than they are right now! they just want the option to drill everywhere, once they get the drilling equipment built…
Comment by bored now Monday, Aug 4, 08 @ 12:16 pm
===By this measure we should import MORE cars from Japan and Korea, and make less.===
That’s complete bass-ackwards and you know it.
===You DO know don’t you that the lease EXPIRES if not used?===
Yes, after 10 years. And then they can renew, at between $2 and $3 an acre.
Comment by Rich Miller Monday, Aug 4, 08 @ 12:17 pm
Six oil companies made a combined $50 BILLION in profit in one quarter, and the GOP’s solution is to hand those companies more government land?
I thought Roskam was safe until I saw him taking a lead on this one. What an easy way for the Dem to make up 20 points.
Comment by Skeeter Monday, Aug 4, 08 @ 12:18 pm
Actually, it’s not. You take a commodity (at world market prices) add value, and sell it on the world market. It makes no difference if we use that to stop imports, or sell it and buy more.
Adding refinery capacity, on the other hand, would be a GOOD thing, to keep more of the value here.
made a combined $50 BILLION
And how much taxes did they pay? Exxon is said to have paid 32 Billion. And no one said “give them leases” rather “let them buy leases”.
Comment by Pat collins Monday, Aug 4, 08 @ 12:28 pm
don’t have the equipment available to drill more holes than they are right now
Why is this surprising? A lot of oil wells in southern IL that were not pumping 5 years ago are pumping now. Why? It makes sense with the price.
Capacity is not static, it goes away if not used.
Comment by Pat collins Monday, Aug 4, 08 @ 12:30 pm
I see two wrong simple-minded assumptions at work here.
1.) Every permit does not end up with an oil well.
2.) We are not exporting oil products that could be used in the US.
On number one - We don’t know what is under the ground. Companies lease thousands of acreage, much of this land doesn’t contain extractable oil. Some acreage must be permitted in order to transport product from those acres where oil is found. Any map shows this.
On number two - the assumption here is that any oil product created in the US should be used in the US. Nonsense! Not every oil product is the same! Not every country has at it’s disposal the ability to manufacture the oil products it needs.
Both of these assumptions are proveably false and ridiculous. To issue these assumptions as some kind of proof demonstrates a lack of understanding regarding oil, oil prices, imports, drilling, leasing, or conducting any mineral or oil extracting business.
Simple-minded, indeed!
Comment by VanillaMan Monday, Aug 4, 08 @ 12:31 pm
VanillaMan, I’m not sure that spouting oil industry talking points is gonna be a great thing for the GOP, but keep it up.
Comment by Rich Miller Monday, Aug 4, 08 @ 12:32 pm
In the 70s US automakers got caught flat-footed by an energy crisis; 30 years later we’re in the same boat again. Back then the mantra was ‘We are running out of oil’ now it’s ‘We need to look for more of our oil–their’s is too expensive.’
How about our country put some of that oil money to work at developing alternative fuels? We won’t be held hostage by oil-producing nations again! Nah—that’s probably too much to expect from a country that finds the metric system too complicated…
Comment by Vote Quimby! Monday, Aug 4, 08 @ 12:33 pm
Pat,
I’m not sure where you are getting your numbers.
However, if a company has after-tax profits of $11 BILLION for one QUARTER, then the company does not need any extra government benefits.
At $3 per acre, that is a giveaway.
That’s MY land that the GOP wants to give away (at the prices discussed, it is in fact a giveaway). I don’t want to give MY land to the stockholders of the oil companies.
Comment by Skeeter Monday, Aug 4, 08 @ 12:33 pm
And PC, if there is, indeed, a crucial shortage of a strategic commodity, then exporting refined products from that commodity shouldn’t be limited or at least discussed?
Comment by Rich Miller Monday, Aug 4, 08 @ 12:34 pm
Rich, I don’t speak for others, but I know that I can dispute the conclusions of the report without resorting to industry talking points.
I would agree that US gasoline exports affect US prices to the extent that we could choose between a trade/no-trade environment. But if we chose the latter, we’d obviously be hurting for the unrefined oil we need. If we choose the former, than since it would be a global market (as it is now), it should have no effect.
Comment by Greg Monday, Aug 4, 08 @ 12:36 pm
If there were a shortage, I would agree. There is plenty around, just the price sucks.
Certainly we should not be discussing opening the strategic reserve
I think the price of leasing is set by Congress? I am shocked that Melissa Bean and Bill Foster haven’t up’d the price. Shocked.
Comment by Pat collins Monday, Aug 4, 08 @ 12:42 pm
I heard the 32 billion in taxes on the radio over the weekend - can’t remember where though
Comment by Pat collins Monday, Aug 4, 08 @ 12:43 pm
==A lot of oil wells in southern IL that were not pumping 5 years ago are pumping now==
And a lot of people are shouting like Jed Clampett! Much of the well equipment is old and outdated, but at $116.75 per barrel it gets people motivated to see them pumping!
Comment by Vote Quimby! Monday, Aug 4, 08 @ 12:43 pm
Have there been any recent, credible studies on whether the U.S. is actually capable of returning to oil self-sufficiency without draining our oil in less than 100 years (when we’d have to have an alternative energy source, anyway)?
It just seems to me that our domestic gas prices are artificially high due to importing oil at higher cost and charging the same for that oil as they do for the domestically-produced oil.
If we have Texas and Alaska, can can drill in that permafrost desert the tree huggers disingenuously refer to as a wildlife refuge (the part of ANWAR proposed for drilling is practically devoid of life), I can’t see why we would need to import oil.
Comment by Snidely Whiplash Monday, Aug 4, 08 @ 12:49 pm
Pat:
For 2Q 2008, XOM paid $10.5B of earnings in taxes. After-tax income was $11.7B.
Comment by Greg Monday, Aug 4, 08 @ 12:50 pm
Pat,
You need to check those sources. Sure it wasn’t some person calling in to FoxNews?
More reliable numbers:
For 2007 (the entire year), Exxon paid $4.3 Billion in taxes, Conoco paid the same, and Chevron paid $1.7 Billion.
The five largest US oil companies combined last year paid about #$13 billion.
For what it is worth — based on the 2007 numbers, Sen. McCain plans to cut those taxes by $3.8 Billion.
Strategy hint to the GOP: This may not be your best issue. Start talking about gay marriage again. That was a proven winner. Ixnay on the “tax cuts and land giveaways for oil companies” plan.
Comment by Skeeter Monday, Aug 4, 08 @ 12:52 pm
Skeeter, your numbers are way off. Probably should check the 10Q before you dismiss others so callously.
Comment by Greg Monday, Aug 4, 08 @ 12:57 pm
I just looked at my most modest investments in the three mutual funds that make up my retirement and 401K portfolios. Among the holdings of those three funds are at least six oil and energy companies. Some biggies, some devoted only to exploration and extraction.
Now, at the small level of my investments, it won’t make a big $ difference to me, but, some of you with the six figure+ balances might want to see if you’re shooting yourselves in the foot by limiting oil exploration and taxing the oil companies to the limit. Corporations are people too, and sometimes we can see them by looking in the mirror!!!
By the way Rich, nice piece on the “most rev/senator Meeks” thing. I knew you’d get to it!
TimB
Comment by TimB Monday, Aug 4, 08 @ 1:03 pm
pat, since you acknowledge that the “drill here, drill now” approach is a flagrant lie and will have no effect on gas prices in years to come, one has to wonder why you — and congressman roskam and the other bush toadies — don’t care to do anything that would help people right now? do you think that gas prices are too low? or are you just relying on gop doctrine that voters are stupid and you may as well try to fool us?
Comment by bored now Monday, Aug 4, 08 @ 1:09 pm
C-SPAN did not televise the revolt according to C-Span because Pelosi arranged for the lights and microphones to be turned off immediately after adjournment.
Between your article and the shenanigans in Washington right now, it appears that our Federal Government in Washington is rapidly devolving into our State Government in Springfield.
Comment by Louis G. Atsaves Monday, Aug 4, 08 @ 1:11 pm
==Pelosi arranged for the lights and microphones to be turned off immediately after adjournment.===
Standard procedure when the House adjourns.
Comment by Rich Miller Monday, Aug 4, 08 @ 1:16 pm
Also, I would venture a guess that our debate here is a whole lot more interesting and enlightening than the House GOP stunt.
Just sayin
Comment by Rich Miller Monday, Aug 4, 08 @ 1:21 pm
yes, but…
isn’t that always true?
Comment by bored now Monday, Aug 4, 08 @ 1:23 pm
Greg,
Maybe you can provide some light for all of us.
How much of the number that you cite was for U.S. income tax?
You aren’t really claiming that the company paid $10B to the U.S. in income tax, are you?
Comment by Skeeter Monday, Aug 4, 08 @ 1:27 pm
just in q2. Way more in 2007. These guys have effective income tax rates in mid-40’s.
Comment by Greg Monday, Aug 4, 08 @ 1:29 pm
During the past seven years we have had an energy policy run by and for the energy industry. Eve before then politicans in both parties have been bought and paid for by the energy industry. There is no question in my mind that the general public is being ripped-off consistent with the premises of shcok capitalism.
Obama expressed a willingness to compromise on offshore oil drilling with a bipartisan goroup of swing Senators last week, subject
to the approval of each State that might be affected by offshore drilling in a particular area. I also liked the idea of a $1000 rebate to each taxpayer funded by a windfall profits tax at least for purposes of generating a little discussion and compromise.
We defintely need a major alternative
energy initiative akin to the Manhattan project. Otherwise we’re defintely over a barrel and at the mercy of big oil and oil-producing
countries and regions.
Comment by Captain America Monday, Aug 4, 08 @ 1:30 pm
Greg,
Let me get this right. You are claiming that the $10B was paid for US income taxes?
You might want to take a look at those number again.
Comment by Skeeter Monday, Aug 4, 08 @ 1:31 pm
Of course, that’s not 100% federal income tax. Sorry if I implied it. I don’t believe xom breaks it down, but I’d guess its federal income tax rate is 36%ish
Comment by Greg Monday, Aug 4, 08 @ 1:31 pm
Feel free to link me to your stats. I’m using regulatory filings and analyst reports.
Comment by Greg Monday, Aug 4, 08 @ 1:33 pm
pat, since you acknowledge that the “drill here, drill now” approach is a flagrant lie
If you think I said that I need to improve my English composition skills.
As for gas prices - the BEST we can hope for is stabilization. When I first went to China in 1991 I saw wide streets in Beijing with no cars.
My last trip, I was able to walk 7 blocks to the DVD store faster than a cab would take me on Fridays rush hour, which was depressingly similar to Schaumburg at 5 PM on a Friday.
I guess India is the same - DEMAND is up. If SUPPLY doesn’t increase, we will have higher prices. We need more supply.
As for the argument “it won’t help for 10 years” - all the more need to start NOW.
Oil has ALWAYS been boom or bust. I paid my way through college in part by working for geologists in Southern IL. The times up to 1974 had been hard on the industry, but by 1977 they were drilling all over southern IL, and IN.
When it flattened out in the mid 80s (after I was graduated, thankfully) it got slow, rigs went unused, etc.
If you want an oil bust in the future, you need to let it boom now.
Comment by Pat Collins Monday, Aug 4, 08 @ 1:33 pm
“Standard procedure when the House adjourns.”
Except that usually you can turn the lights back on again by flicking a switch.
Nancy took out the breacker.
Comment by True Observer Monday, Aug 4, 08 @ 1:34 pm
Greg,
I’m still confused.
So now you are no longer claiming that the company paid $10B+ to the U.S. in income tax.
What else, if anything (other than the U.S. income tax) was included in that figure?
Comment by Skeeter Monday, Aug 4, 08 @ 1:34 pm
I’d like to see a poll on whether the general public has “any” confidence in the 2 major political parties’ energy policies. They both seem to be playing to the crowd, without much intellect or reasoning behind their positions.
To tell the truth, I think the market is doing more to move us in the right direction on energy than either of the two parties’ various mouthpieces. If oil stays above $100 a barrel, it will motivate more exploration, more investment in alternative sources, and encourage more conservation. Neither suing OPEC, releasing oil from the SPR, lowering taxes on Big Oil, or drilling in the Atlantic Ocean appear to be real or meaningful short or long term solutions.
Comment by Six Degrees of Separation Monday, Aug 4, 08 @ 1:35 pm
Greg,
Let me toss out another question.
The oil companies and the GOP want to give away OUR land for about $2.50 per acre.
What do foreign countries charge to extract oil from their lands?
How does that compare to the the GOP plan?
Comment by Skeeter Monday, Aug 4, 08 @ 1:36 pm
When people talk about the drilling licenses, and the ones actually drilled, it’s often a case of statistics being tossed around, but also a case of being “factual, but incomplete”.
For example, there’s more drilling going on down in Southern IL for stripper wells than there is in other areas outside of IL which are more likely to have measurable oil and/or gas production.
The reason is that Southern IL has nearby pipelines and collection terminals already in place, with relatively close by refining capacity. In simple terms, the infrastructure is already in place to handle the additional product. And there’s spare capacity for the short runs.
Bottom line: Oil logistics will heavily influence oil production decisions.
I’d tend to find the US House report more credible if they actually took the related oil infrastructure (logistics) issues into place - but that wouldn’t allow the US House to “cook the facts” to their desired outcome.
Comment by Judgment Day Is On The Way Monday, Aug 4, 08 @ 1:42 pm
Good thing I’m bored at work today. I don’t know the answer to your most recent question, but keep in mind that most foreign companies are national or quasi.
Effective income tax rate can also include state tax. I’m pretty sure xom didn’t break it up, but I haven’t read every word of their release. Analysts certainly don’t care which one (state versus feds) its going to; they just include one line in the spreadsheet.
Because I won’t say anything I don’t know to be true, I can’t claim exactly how much XOM paid in federal income tax, but I have a pretty good estimate. I can say they paid a total tax of $30B last year.
Comment by Greg Monday, Aug 4, 08 @ 1:44 pm
==I’m not sure that spouting oil industry talking points is gonna be a great thing for the GOP, but keep it up.==
Whether the facts are considered by proponents to be talking points doesn’t diminish their accuracy.
Comment by VanillaMan Monday, Aug 4, 08 @ 1:45 pm
The oil companies and the GOP want to give away OUR land for about $2.50 per acre.
Conveniently neglecting that Nancy and the Windies could change that, if they wanted to. If it’s so bad, why hasn’t she sent a bill to the Senate? Why hasn’t “the O” filed a Senate bill?
Comment by Pat Collins Monday, Aug 4, 08 @ 1:50 pm
i’m not arguing that demand isn’t up. i don’t expect demand to go down. but given the fact that american oil ventures can’t drill here NOW, why should i accept their lie? because you say that “Oil has ALWAYS been boom or bust?”
instead of relying on oil as a part of our energy future, we would have a much more immediate impact on prices if we truly committed to moving away from oil right now. it doesn’t matter to us that demand for oil worldwide is increasing if we don’t rely on oil for our energy needs. instead of trying to get oil from fragile and publicly-owned locations in perhaps a decade, it would be smarter to ween ourselves off oil in that decade.
there is really no future in oil. the rest of the world will drive up demand, and our continued reliance upon it will only choke off our economy. we should provide no — none — tax breaks for oil exploration and development, and we should absolutely tax the hell out of oil, both produced domestically and that which we import. we should instead give tax credits and other incentives — heavily — to alternative fuels that are not oil-dependent.
we choose to be co-dependent with the oil industry. we can choose now to break that co-dependency. let the rest of the world compete for our diminishing world supplies of petroleum. our 21st century vision should be an oil-free nation, leading the world from its dependency on petroleum, not following every other nation down this road of ruin…
Comment by bored now Monday, Aug 4, 08 @ 1:51 pm
None of this is being debated because the Democratic leadership in COngress is not allowing the debate.
Comment by Anon Monday, Aug 4, 08 @ 1:58 pm
our 21st century vision should be an oil-free nation
One that is driven by cars with electric batteries that charge up nightly from all the nuclear plants we will build now? Yes, I agree that would help a lot.
By all means, let us start to build MORE nukes
Comment by Pat Collins Monday, Aug 4, 08 @ 2:11 pm
If you’re looking for a general detailing of the taxes paid by Exxon, check out the CNN Money article: http://money.cnn.com/2008/07/31/news/companies/exxon_profits/?postversion=2008073109
‘ In addition to making hefty profits, Exxon also had a hefty tax bill. Worldwide, the company paid $10.5 billion in income taxes in the second quarter, $9.5 billion in sales taxes, and over $12 billion in what it called “other taxes.” ‘
We can quibble about what ‘other taxes’ means, but it seems that Exxon and other oil companies are definitely paying a lot in taxes on their income.
Money quote from article: “World’s largest publicly traded oil firm makes $1,485.55 a second…”
Not mentioned: By CNN’s own figures, Exxon pays over $4000 a second in taxes.
Just some food for the discussion
Comment by Former-something-or-other Monday, Aug 4, 08 @ 2:13 pm
The fact that oil is not under every single acre is a red herring, it does not therefore follow that oil is under none of those 68 Million acres in currently held leases.
In fact, there is not a single Oil compnay on record cliaming that the unused leases are useless or are on land with no oil. But more to the point. several of the surveys used by the oil companies for thier current off shore operations show large reserves of oil under their current lease holds; they just are not drilling them so they can stretch out the supply. The additional leases are not needed to give access to untapped supplies; the oil compnaies want new leases so they can lock up more of the supply while keeping production limited.
The Oil companies reported record profits, the highest earning ever! These records come at a time when they are intentionaly self limiting their own production and selling oil produced domestically to foreign countries. The oil companies then use their own self installed production limits to argue that we ned to give them larger reserves.
We need to stop the current export cycle; implement price controls and open up the lease system. its simple, give any oil company who wants to drill on those un-utilized acres the right to do so. I bet the argument about oil not being under every one of those acres will fall away if we open up the right to any company to tap those supplies. After all, if those acres have no oil why provide an exclusive lease? If they do have oil then we need to require the companies pull out what they have before giving them more supply.
The current request for more leases is just the Big oil companies trying to lock up more supply so they can limit production. Lets instead open up the leases on the un drilled areas and see how many of the acres are truly non-productive.
Comment by Ghost Monday, Aug 4, 08 @ 2:13 pm
Actually, PC, there’s enough electric production capacity at night to charge a surprisingly large number of electric cars.
Comment by Rich Miller Monday, Aug 4, 08 @ 2:13 pm
===The current request for more leases is just the Big oil companies trying to lock up more supply so they can limit production.===
What we may need are laws that disallow the companies from using the untapped resources to boost their corporate balance sheets if they’re not actively exploiting said resources.
Comment by Rich Miller Monday, Aug 4, 08 @ 2:15 pm
um-um-um-um-um-um. How many ? Since you’re not letting in comments.
Comment by Maggie Monday, Aug 4, 08 @ 2:17 pm
Price controls! I love it. Capping prices ought to get our demand under control. Just look at how well it works overseas.
Comment by Greg Monday, Aug 4, 08 @ 2:17 pm
$9.5 billion in sale tax?
What is Exxon buying that forces it to pay sales tax?
In fact, the “sales tax” is something that simply passes through the company. WE pay the sales tax, not Exxon.
To the extent that it is a worldwide “sales tax”, the reason that it is paid is that when other countries give up their oil, they charge a lot more than $2.5 per acre. Most countries with oil charge prices of up to 90% of the value of that oil.
90% of the value of the oil, like the rest of the world, or $2.5? No wonder the oil industry is dumping money on Sen. McCain.
Comment by Skeeter Monday, Aug 4, 08 @ 2:31 pm
Skeeter, ignore the article. The numbers I’m using don’t include that. I’ve been giving you the income tax payments.
You’re starting to grasp at statistics. Be careful. We’ve had enough plainly wrong numbers today.
Comment by Greg Monday, Aug 4, 08 @ 2:38 pm
skeeter, all corporate taxes are passed through to their customers. one of the arguments about lowering corporate taxes.
Comment by wizard Monday, Aug 4, 08 @ 2:51 pm
Maggie, what are you babbling about?
Comment by Rich Miller Monday, Aug 4, 08 @ 3:09 pm
sorry, pat, i don’t have a knee-jerk reaction against nuclear energy. there *are* a lot of problems with what you do about the left-over waste — feel free to volunteer to bury it under your house — and we are left with the nimby problem. i’m more interested in clean energy supplies, and nuclear doesn’t qualify at this time. i certainly wouldn’t support tax benefits for nuclear energy without resolving this issue. but i don’t think that power companies shouldn’t try to find a cleaner solution. breaking away from diminishing supplies of oil will require innovation anyway, not just in the area of nuclear energy…
Comment by bored now Monday, Aug 4, 08 @ 3:10 pm
Greg,
Income taxes in the U.S. or worldwide?
When you talk about “grasping” it seems to be exactly what you are doing. You found a large number and now are clinging to it, despite the lack of meaning.
But back to the point about drilling rights: When you look at what the GOP wants to “charge” for the rights, and what the rest of the world charges, you realize that in fact, the GOP does want to give it away.
Comment by Skeeter Monday, Aug 4, 08 @ 3:15 pm
Skeeter, I’m giving you the actual income tax figures, most of which is US federal income tax.
Your initial number was wildly off, and I provided the correct one. I’m not addressing the politics of it. I didn’t happen upon a large number; it’s staring me in the face right on the income statement. There’s no dispute about taxes paid.
I apologize if this is confusing. I cannot easily copy and paste the spreadsheets. I would never provide you all with an incorrect or misleading number.
Comment by Greg Monday, Aug 4, 08 @ 3:20 pm
By the way, I have absolutely no idea what the meaning of gross taxes is. I find it about as relevant as gross profit. I have zero interest in it, beyond correcting at least 2 different wrong representations of it.
Comment by Greg Monday, Aug 4, 08 @ 3:28 pm
Greg,
The 10.5 is, in fact, a worldwide number.
My initial number was “wildly off” because it was for 2007. Apples to apples. My number wasn’t wildly off. It was right on target for the year that I referenced.
Comment by Skeeter Monday, Aug 4, 08 @ 3:29 pm
Greg, are you arguing that the oil companies are over-taxed? Do they receive too few tax benefits?
I’m not clear on your concept. Nitpicking over numbers is distracting this here debate.
Comment by Rich Miller Monday, Aug 4, 08 @ 3:32 pm
You know what, I give up.
Comment by Greg Monday, Aug 4, 08 @ 3:33 pm
That wasn’t to you, rich. Basically, I was trying to correct Skeeter’s numbers. He says 10.5 is worldwide for 2007, which is nowhere close. XOM alone is 30 for 2007.
I don’t care at all about this number. But I absolutely detest rampant misinformation, when all you have to do is look up the edgar filings. It’s like you with the state constitution.
Comment by Greg Monday, Aug 4, 08 @ 3:35 pm
Nuclear waste? On-site storage seems to be the best solution until something better (that is politically acceptable) is found. Bury it deep with proper security and containment; make it retrievable in case a better disposal site is found. After all, there’s a nuke plant there, anyway. And I suspect most “new” nuke plants in the US will be built at existing sites (as “expansions” or replacements for obsolete facilities), just like the dreaded oil refineries.
IL is actually sitting relatively pretty in the energy picture within the US, with its large share of nukes and increasing share of wind power.
Comment by Six Degrees of Separation Monday, Aug 4, 08 @ 3:45 pm
hmmm, my 10,000 shares in a (decently performing) power company left me with the impression that power companies don’t want to store nuclear waste on-site. at least, that’s what i’m supposed to say to my congressman and senators. i’d suggest that on-site storage isn’t “politically acceptable” either…
Comment by bored now Monday, Aug 4, 08 @ 3:56 pm
Greg,
That’s not accurate. I was far more specific. I stated that for 2007, Exxon paid $4.3 billion in U.S. taxes. That’s from the 10-K filed by Exxon.
Not that it matters.
Again, the initial point was that the GOP wants to give away American land to oil companies. Considering that other countries are charging massive amounts for similiar rights, and considering the after-tax profit of the oil companies, and given that drilling rights are not currently being used, it seems like bad policy to give those rights away.
Roskam feels differently though. He thinks we should give American land to oil companies. In a few months, we will see if the voters agree.
Comment by Skeeter Monday, Aug 4, 08 @ 4:00 pm
Bored…
That’s where it is now. As long as Harry Reid has the clout he has, it is not likely to be going to Yucca Mountain. And on-site storage eliminates the issue of nuke waste traveling on trucks and trains on its way to a remote disposal site. All things considered, I think on-site storage is the least politically controversial method, even if the energy companies would rather not have the liability.
Comment by Six Degrees of Separation Monday, Aug 4, 08 @ 4:05 pm
Ok, I better understand what you mean now on the tax front. XOM has a ton of foreign operations as well as most reserves.
How better do you auction land?
Comment by Greg Monday, Aug 4, 08 @ 4:07 pm
Who cares about gas prices, gas is cheap!
Everyday I buy 10 gallons and just dump it out on the ground for fun!
Seriously, does anyone trust Oil companies that make huge profits, and have no incentive to make thier business more efficient?
Does anyone really think Politicians are going to really do anything about it, since most take big money from big oil?
Does anyone really think anything will work other than changing our consumption?
Comment by Speaking At Will Monday, Aug 4, 08 @ 4:12 pm
I should apologize. I think I usually do a good job of understanding people’s points, but after I re-read the series of comments in this posting, I obviously missed it somewhat. I am a stickler for numbers and mis-read at at least one point skeeter’s attribution of a number. Sorry.
Trying to add more substantively to the debate, my main concern right now is actually falling prices. I mean, they’re down another 3.5% today. I’m not sure we can keep up this falling year over year demand at this pace.
If the dollar recovers, we’re going to be using gas as weed killer again (or at least I will be.)
Comment by Greg Monday, Aug 4, 08 @ 4:19 pm
Speaking at Will…
You are talking about a consequence, not a solution.
When oil-based energy prices get high, people use less if their demand has some elasticity to it. We are now seeing the results of that elasticity. To the extent that high oil prices are being manipulated by Big Oil, they will either kill their golden goose when more cost effective energies supplant oil use and people avoid oil use, or they will back down when they see the threat. Big Oil may be able to temporarily manipulate the situation to its advantage, but they can’t forever hold back over 100 sovereign nations’ governments and people who are looking for other solutions, or the bright people who are also looking for thiose solutions. Energy R&D is a white-hot field to be in now.
Every technology has its useful lifespan. How many telegraph operators or whale oil salesmen do you know?
Comment by Six Degrees of Separation Monday, Aug 4, 08 @ 4:27 pm
Regardless of your point of view - the real shame is that the Democratic leadership left town and did nothing to address the debate or represent your view.
Comment by Anon Monday, Aug 4, 08 @ 4:33 pm
===the real shame is that the Democratic leadership left town ===
C’mon. The summer break has been scheduled for how many months?
Comment by Rich Miller Monday, Aug 4, 08 @ 4:39 pm
…and NOTHING was done prior to the break…
Comment by Anon Monday, Aug 4, 08 @ 4:46 pm
Anon, one could easily point out that “nothing” has been done to stop this mess for the past 7.5 years, 15.5 years, 19.5 years, 27.5 years, etc.
Comment by Rich Miller Monday, Aug 4, 08 @ 4:56 pm
I was babbling about Patti. You are the first person who has ever met and liked her.
She must have been on her best behavior for you. With staff she is demanding, jealous, and demeaning. In all the years she has been first lady she has been unable to keep a full time assistant.
You sure got the wool pulled over your eyes.
Comment by Maggie Monday, Aug 4, 08 @ 5:30 pm
whatever. rich, you should try this site - you may have seen it already but since you are a music lover it should be in your wheelhouse.
http://www.pandora.com/
Comment by Anon Monday, Aug 4, 08 @ 5:34 pm
Maggie, I spent three entire days with the woman in a tightly enclosed space. That’s tough to fake.
Also, I’ve heard she’s tough on staff, but I know a lot of people who are also that way. I also know a lot of staff who are thin-skinned and unable to cope.
If RRB was my spouse, I’d probably be difficult to deal with. lol
Comment by Rich Miller Monday, Aug 4, 08 @ 5:35 pm
Anon, I blogged about that site years ago.
Comment by Rich Miller Monday, Aug 4, 08 @ 5:36 pm
i figured i was behind the curve - i think i remember you doing so.
Comment by Anon Monday, Aug 4, 08 @ 5:37 pm
Anon, what I’ve tried to get across here, and probably failed because I should’ve been more specific, is that I have about as much respect for this stunt as I do the governor’s constant drama queen act.
Comment by Rich Miller Monday, Aug 4, 08 @ 5:41 pm
Skeeter advises: “Strategy hint to the GOP: This may not be your best issue. …. Ixnay on the “tax cuts and land giveaways for oil companies” plan.”
Hence the steady drumbeat — which Rich Miller herein pans — of the rather hollow “Drill Here. Drill Now. Pay Less” bumper sticker. And it is a bumper sticker. I saw a car from Michigan — go figure — with a bright blue sticker featuring those 6 words on its rear.
As noted by so many on this thread, that slogan should really be:
- Drill Here (but not on the 68 mil acres the Oil Cos. already lease but don’t drill on)
- Drill Now (even though the Oil Cos. admit they don’t even have the equipment to drill and even though they also admit that once they do build the rigs it will take several more years to produce anything worthwhile)
- Pay Less (we actually already are currently paying less, because the “free” market reacted and started using less. We can continue to use less by both improving mileage standards and better developing alternate, but truly renewable, energy sources… Think a California-made solar panel on your roof and a Detroit-made Chevy Volt — or something — in your garage… But unfortunately that won’t create record-breaking profits for ExxonMobil; profits which still weren’t high enough for Wall Street.)
Comment by Rob_N Monday, Aug 4, 08 @ 6:07 pm
PS: If the oil cos. actually wanted to “drillheredrillnow” they’d invest the $2 million (and counting) they showered on John McCain over the last month in a new derrick instead of a candidate.
But, keeping gas prices high keeps their profits high — so they restrict the flow (no pun intended) by not investing in refineries and new derricks as much as consumers would expect them to.
Comment by Rob_N Monday, Aug 4, 08 @ 6:11 pm
Like big oil is in the tank for Republicans… democrats want the price high. Oil companies want the price high. No matter what the final desire of either is, they both want prices to remain high.
Comment by Heartless Libertarian Monday, Aug 4, 08 @ 7:52 pm
If there is oil anywhere in our country, why shouldn’t we drill there? So there are leases for 60+ million acres already. If those acres are not viable for oil production then why can’t we look elsewhere, especially if we know there is oil there.
Don’t we have an obligation to do what we can to make energy cheaper? We should drill more, increase solar, wind, hydro, nuclear, efficiency, etc. Why does Nancy & Harry get to decide we can’t drill on other land?
Wouldn’t lower fuel prices help lower food, clothing and other costs? Wouldn’t that help the poor and middle class? I’m getting tired of Pol’s saying we can’t drill….We can and We should. Unfortunately Nancy and Harry are holding us all hostage to high prices.
Comment by Ultra50k Monday, Aug 4, 08 @ 9:20 pm
Interestingly enough, the U.S. Constitution allows the President to call the Congress back for the equivalent of “special sessions.” This would seem to be a good opportunity for President Bush to exercise this authority. Don’t quote me on this, but I think the last time a president used this power was when Harry Truman called back the “do nothing Congress” - purportedly to deal with pressing domestic concerns. Bush could make a lot of hay on this issue - that is, calling the Congress back to deal with the price of gasoline and the so-called gas shortage.
Comment by chicago publius Monday, Aug 4, 08 @ 9:36 pm
Ultra50k,
The first of the off-shore drilling bans were put in under Reagan. George Bush Sr. was the one who put in the Executive Order against drilling.
Why are you choosing to blame only Dems for the banned off-shore sites?
The oil companies have decided it is to their benefit (ie, improves their bottom line) if they keep refinery operations to a minimum, which means no room for expansion (ie, the oil companies are the ones “holding us all hostage to high prices”).
Why are you blaming Dems for the actions of the oil companies?
As for drilling (and Chicago Publius and others, this goes out to you also)… even opening up the protected areas now, this very second, will not have any effect whatsoever on the availability (or lack thereof) of gas this summer or heating oil this winter. The start-up time on building a new off-shore oil derrick is simply too long (8-10 years).
Pres. Bush himself holds the key to the National Petroleum Reserve and could instantly release hundreds of thousands (or more) of barrels if he wanted… He isn’t, and has repeatedly said he won’t.
As I alluded to before, there’s one reason the Republicans keep repeating their hollow bumper sticker slogan — they want to cover up for the facts and practicalities of the situation which are decidedly not in their favor (or in the record-breaking high profit oil cos’ favor, truth be told).
Comment by Rob_N Monday, Aug 4, 08 @ 10:02 pm
Good God,
Thanks Rob N and others for carrying on this conversation. I am way too tired, and finally enebriated enough to engage this debate, but cannot respond with your eloquence.
FYI, and this will come as no surprise, I refer all of you back to Obama’s energy speech. This discussion thread is a good synopisis of the salient points to be debated.
I can’t imagine arguing the “Drill here/Drill now” position but totally enjoy reading its preiew here.
Thanks Rich. And others!
Comment by 47th Ward Monday, Aug 4, 08 @ 10:43 pm
chicago publius, the president has said he won’t call Congress back for a special session.
Comment by Rich Miller Tuesday, Aug 5, 08 @ 6:49 am
Rob n- oil companies do not “build” or own the rigs. They belong to drilling companies and are leased to the oil companies. Once a productable field is located (offshore) then the oil companies erect the platforms, but the drilling equipment is still owned and operated by the drilling companies, not the oil companies.
Comment by wizard Tuesday, Aug 5, 08 @ 7:31 am
If there is oil anywhere in our country, why shouldn’t we drill there? So there are leases for 60+ million acres already. If those acres are not viable for oil production then why can’t we look elsewhere, especially if we know there is oil there.
apparently, you’re not a fan of private property rights. or public property, either!
we don’t know if there is oil on the leases that the oil companies already have because they aren’t looking for oil there. the president of the american petroleum institute admits that they can’t — they don’t have any unused equipment!
the “drill here, drill now” slogan is just a ruse, designed to make dumb suckers believe that the oil companies care about lower prices, too, while reaping the great rewards of higher prices. and you are certainly free to think that, if you choose. but i live in a reality-based community.
in the reality-based community, we know that *no one* knows where oil can be found without having tested geological conditions (which they haven’t for the ocs or eastern gulf). sure, the oil companies can infer that there is oil in the eastern gulf because there is oil in the western gulf. but they don’t know. they are guessing.
you’ll find that most floridians, especially those on the western coast of florida, don’t want to risk a multi-billion economy for a few less cents paid at the pump. drilling off the coasts of florida (the oil companies’ wet dream) won’t happen as long as floridians have a say in it. there is no reason to alter the moratorium as long as this is the case.
Don’t we have an obligation to do what we can to make energy cheaper?
barack obama announced a wonderful new energy plan that will do just that! he will take those excess profits from the big oil companies and use it for tax breaks for america’s families! it’s a terrific proposal.
Unfortunately Nancy and Harry are holding us all hostage to high prices.
like i said above, you can choose to be ignorant. that you think congress can effect the price of gas paid at the pump shows a certain naivete that i suppose no one can address here. since you don’t believe in property rights, you probably can’t understand how the market works. nancy and harry don’t control the invisible hand…
Comment by bored now Tuesday, Aug 5, 08 @ 7:44 am
[…] In recent days the national Republicans and their partisan supporters have doubled-down on their empty “drill here, drill now” rhetoric to advance their proposal to open up protected coastal waters to off-shore drilling. They’ve been handing out bumper stickers, staging their own live soap opera from the House floor in DC and (shocking!) poking fun at Sen. Obama’s sage advice to keep your tire pressure and engine tuning up to spec. […]
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