And These Guys Need More Tax Breaks?


Profits at Exxon Mobil surged 36 percent to a near record $10.4 billion in the second quarter as surging oil prices helped the world’s largest publicly traded company soundly beat Wall Street forecasts.

The company’s profit – which amounts to a cool $1,318 a second – is the second biggest ever reported by a U.S. company, behind only the $10.7 billion Exxon itself earned in the fourth quarter of 2005.

The $1,318 a second would buy enough gasoline, even at the current $3 a gallon national average, to drive a Hummer H3 between Los Angeles and New York three times.

One analyst said Exxon’s record fourth-quarter earnings in 2005 included a $400 million tax charge that analysts were not including as part of that quarter’s profit

Compounding matters, the company gave its outgoing CEO Lee Raymond a retirement package worth about $350 million around the same time.That combination of events led to a public outcry calling for restrictions on CEO pay and calls from lawmakers who wanted to institute a windfall profits tax on the oil industry or even break up some of the oil giants that merged in the 1990s

And this is what disturbs me the most.

“Apples to apples, this quarter is the highest by any organization ever,” said Fadel Gheit, an energy analyst at Oppenheimer.

Gheit said the company sent $7.9 billion back to shareholders in the second quarter in the form of dividends and stock buybacks.

He said Exxon’s expenditures on exploration and production were sufficient, as most of the world’s oil reserves are by now widely known. Extracting those reserves, he said, is constrained more by politics than it is by lack of spending on exploration.

Gheit thought the company was striking a good balance with how it is spending its cash.

When asked about investing in renewable energy technologies, an Exxon official said that, apart from ethanol, it’s generally not part of the company’s plan.

“There are very few that are economical without subsidies,” said Henry Hubble, vice president for investor relations, on a conference call. “We don’t think it makes sense to invest in it at this point.”

Subsidies!!?!!! After earning USD 10.8 billion dollar profit they still need subsidies? Fuck!!

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