[Congressional Record (Bound Edition), Volume 152 (2006), Part 5]
[House]
[Pages 6718-6719]
[From the U.S. Government Publishing Office, www.gpo.gov]




                       RECORD OIL COMPANY PROFITS

  Ms. KAPTUR. Mr. Speaker, I ask unanimous consent to claim Mr. 
Pallone's time.
  The SPEAKER pro tempore. Without objection, the gentlewoman from Ohio 
is recognized for 5 minutes.
  There was no objection.
  Ms. KAPTUR. Mr. Speaker, I hope the American people are paying 
attention to the massive oil company profits being made off of the 
pocketbooks of our people. Gasoline prices have gone up 68 cents just 
since last year per gallon. Gasoline prices are soaring. I left Ohio 
this morning after casting my vote in the primary election. Gas was $3 
at the pump, and some of the brands were as high as $3.85 a gallon.
  Who are we making rich? ExxonMobil, they are number one. They 
declared a record quarterly profit of $8.4 billion, 7 percent more than 
they made last year. Meanwhile, their chairman, Lee Raymond, is 
planning on his retirement. His package totals $400 million when all 
pension payoffs and stock options are included.
  I have often asked myself, what does somebody do with $400 million? 
When is enough enough?
  Now, this is the same Exxon that has yet to pay the $4.5 billion in 
punitive damages awarded in the Exxon Valdez case 17 years ago. They 
haven't even paid off those they harmed.
  Now, not to be outdone, ConocoPhillips said its earnings rose 13 
percent, to $3.29 billion, just in the first quarter of this year.
  Now, Chevron Corporation's first quarter profits soared 49 percent, 
to $4 billion, as the firm joined the procession of U.S. oil companies 
reporting colossal earnings.
  Meanwhile, constituent after constituent in my district tells me they 
can no longer afford weekend family trips due to gas prices. People are 
only filling their tanks up halfway, hoping prices will drop and they 
will not have to pay these exorbitant prices.
  Other companies like Halliburton, think about this. We have a Vice 
President. He got a tax refund of nearly $22 million. Halliburton is an 
oil servicing firm that has gotten so many no-bid contracts from this 
government related to the war in Iraq and other oil-related 
expenditures. Come on. Can't we connect those dots? Can't we figure out 
what's going on here?
  Farmers tell me that higher fuel costs mean their already ultra-slim 
margin of profit is likely to disappear.
  Small businesses worry about whether or not they can impose delivery 
surcharges to make up for higher fuel costs.
  Now, all the President of the United States says, listen carefully. 
He says we have to study this. Hmm. He says we have to study this. We 
have to study the profits.
  Mr. President, we need to do something. The President says that these 
companies should reinvest their money in energy projects here. But keep 
in mind that Exxon officials told the staff of the House Energy and 
Commerce Committee this year that Exxon doesn't intend to spend any 
money in this country because of flat demand for petroleum products by 
the year 2030. So the President appears to be some days late and a 
refinery short.
  Something the President could do, using his Presidential authority, 
is to change the Strategic Petroleum Reserve to a Strategic Fuels 
Reserve and begin converting this country to non-oil-based fuels. His 
agriculture bill didn't do that. We put a title IX in the agriculture 
bill to convert quickly. We can do ethanol and biodiesel right now. But 
guess who won't sell it? Every one of those oil companies.
  Think about the communities you live in. Let's say you buy a Ford 
Taurus that is an E85, and you can put ethanol in the tank. Unless you 
are from Minnesota or Iowa, where are you going to buy the fuel? Guess 
who locks you out at the pump? Every single one of those companies, 
because they want business as usual.
  At some point, we have to do what is right for the country before any 
single company's interests. This is in the national interest not to 
have the economy take a nosedive again because of our dependence on 
imported petroleum.
  The other body is contemplating the cute idea of a $100 tax rebate to 
every citizen. Well, what does that do about the price of gasoline? 
What does that do about converting the type of fuel you put in your 
tank and making America energy independent again? What does this do to 
end our presidentially decreed addiction to oil from unstable regimes? 
All it does is it transfers wealth to those very same companies that 
are locking out the new future for America, the new energy future we 
needed to embark upon in the last century and, sadly, we did not have 
the leadership to do it.
  So profits are up again. Golden parachutes are being readied. The 
industry snubs its nose at the consuming public that can't afford these 
prices. The Bush government says, trust us, let's just study some more. 
That is all we need to do is study.
  Is it any reason the American people are upset? They have a right to 
be upset. We need leadership in this government. No more followership.

         [From The Blade: Toledo, Ohio, Friday, Apr. 28, 2006.]

            Quarterly Profit Tops $8 Billion at Exxon Mobil

       Dallas.--Exxon Mobil Corp. posted the fifth-highest 
     quarterly profit for any public company in history yesterday, 
     and with oil prices above $70 a barrel it could go down as 
     the company's weakest quarter for the year.
       Exxon Mobil's first quarter was lower than its record 
     fourth-quarter, when the world's largest oil company reported 
     the highest profits ever for any publicly traded company. And 
     the earnings, which rose 7 percent to more than $8 billion, 
     still fell short of analysts' estimates.
       But, in what is sure to spur the growing furor over 
     outsized energy industry earnings, Exxon Mobil's massive 
     profits may only increase in 2006 as it benefits from rising 
     crude-oil prices and production, analysts say.
       ``This is only the beginning,'' said Fadel Gheit, analyst 
     for Oppenheimer & Co. ``Let me tell you, it gets better after 
     that. Oil prices will add huge amounts to earnings, at least 
     a billion dollars.''
       The earnings report comes amid consumer outcry in the 
     United States about soaring gasoline prices, which average 
     $2.91 a gallon nationwide, or 68 cents higher than a year 
     ago.
       It also lands as Washington lawmakers are looking to 
     appease voters with various proposals to make big oil 
     companies pay more taxes or provide consumers with some other 
     relief. But everyone acknowledges that little can be done in 
     the short term to bring down prices.
       ``If we had a silver bullet, we, would be proposing it to 
     Washington, right now,'' said Ken Cohen, the company's vice 
     president of public affairs. He said Exxon Mobil was 
     investing a growing portion of its profits in new oil and gas 
     production, and that the company is sympathetic to the added 
     energy-price burden on consumers.
       Still, he said consumers and members of Congress need to 
     ``take a deep pause and a deep breath'' because market forces 
     will eventually bring supply and demand back into balance. He 
     said Congress could help matters longer term by removing 
     barriers to domestic drilling.
       The increasing public scrutiny of Exxon arrives less than a 
     month after the news that the company handed its former 
     chairman and chief executive officer, Lee Raymond, a $400 
     million retirement package, when all pension payoffs and 
     stock options are included, that sparked headlines across the 
     country and calls in Washington to justify the huge 
     compensation.
       In January, Exxon posted the highest quarterly profits of 
     any public company in history: $10.71 billion for the fourth 
     quarter of 2005 and $36.13 billion for the full year.
       Howard Silverblatt; a senior index analyst for Standard & 
     Poor's, said the latest profit figure still places Exxon 
     fifth historically among quarterly earnings. Exxon also holds 
     the first, second, and fourth spots; Royal Dutch Shell PLC 
     has the third spot.
       In the first quarter, net income rose to $8.4 billion, or 
     $1.37 per share, from $7.86 billion, or $1.22 per share, a 
     year ago. Roughly three-quarters of that profit came from the 
     company's upstream division, which produces oil and natural 
     gas.

[[Page 6719]]

       Analysts polled by Thomson Financial were looking for a 
     higher profit of $1.47 per share for the latest quarter.
       Analysts and company executives identified two major 
     contributors to coming up a dime short: higher taxes on oil 
     and gas produced abroad and reduced income from Exxon's 
     refining business, which spent heavily on maintenance in the 
     aftermath of last year's hurricanes.

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