Remember when Exxon Mobil (NYSE: XOM) was the symbol of all that was evil in corporate America? Remember when people were pawning their jewelry to buy gas? Remember when politicians spoke of a windfall profits tax? Well, move over Wall Street, the largest publicly traded oil company is back again to grab some of the negative publicity.The company reported $45.22 billion in profits last year, the largest ever for an American corporation. The results beat Exxon's previous record. Exxon spent $40 billion on dividends and share buybacks.
Before people start booing, there is some "good" news. Exxon's fourth quarter profit fell 33% to $7.82 billion, or $1.85 per share. The "bad" news is that the results were 8 cents better than analysts surveyed by Bloomberg News expected. Revenue plunged 27% to $84.7 billion on lower oil prices. Competitor Chevron Corp. (NYSE: CVX) also reported better-than-expected earnings.
Exxon's strength continues to inspire confidence in investors who have seen other major energy companies, such as ConocoPhillips (NYSE: COP), post disappointing results. As Bloomberg News notes, Exxon is taking advantage of the economic downturn by boosting capital spending by as much as $5 billion.
Investors are snapping up shares of Exxon even as drivers curse the company's name under their breath. The company's reputation probably will be damaged further since oil prices are expected to rise once OPEC's production cuts take hold. Eventually, gasoline prices will follow suit. In fact, gasoline prices are already rising from their lows.
Exxon's current profit record is sure to be broken. People will be outraged again by the price to fill up their tanks and demand a pound of flesh from big oil. I think that raising taxes on petroleum producers in a recession is a mistake and will do nothing to lower energy prices.
People mad at the oil companies can always drive less or conserve energy. It's a more effective way to "stick it" to these hated companies than punitive taxes.











Reader Comments (Page 1 of 2)
1-30-2009 @ 11:20AM
brrrrk said...
OK, let me get it straight. We're in the worst recession we've ever seen and likely headed to a depression. At the same time we have the oil companies that are still pulling in record (albeit slightly less than expected) profits. And we still want to continue to give these bastards a free ride tax wise while the rest of us are "getting bent"... What's wrong with this picture? When are we going to say enough? The economy is here to serve US and not visa versa.
1-30-2009 @ 11:46AM
Explore said...
This article exhibits why energy companies should all be non-profit. Nationalize all of them.
1-30-2009 @ 11:57AM
northrnltspd said...
Screw big oil ! They are responsible for a lot of what has happened to the working class with their HIGH PRICES on fuel. It wasn't enough to have a so-called Cost of Living increase - They just plain old fashioned RAPED the consumer. RECORD PROFITS MY ASSSSSSSSS !
1-30-2009 @ 12:04PM
ihmd said...
So that is where the Bush Tax stimulate checks ended up! Thanks Enron!
1-30-2009 @ 12:23PM
daang7601 said...
OPEC Secretary General El-Badri Says $70-90 a Barrel Is `Reasonable' Price...
Let's answer these camel countries with a big fat "NOOOOOOO!!!!" Oil should be at $5 bbl!!! And we PROCEED with our fuel usage cutting... Keep cutting folks, until they're completely drowned with their bloody oil...
1-30-2009 @ 12:08PM
Replicus said...
The title of this article implies that all who have a problem with oil companies making record profits must be haters. In contrast I would say that the oil companies must hate people in general because they certainly don't exhibit any caring, but then that's what this hierarchy believing world is all about. As long as the majority of people on this planet believe in hierarchies the people on the top will Use the people on the bottom to keep them on the top. Hierarchies are all pyramid programs and they are all wrong.
1-30-2009 @ 1:18PM
KC said...
Obviously Exxon is not, like Marathon Oil, wasting any of its money either upgrading existing refineries or building new ones - - - heaven forbid that the huge, huge, MONSTER reserves at Gull Island Alaska and North Slope have some facility in the states to refine the oil into useable fluids. Marathon, being a good corporate neighbour, would be my investment choice; Exxon, poster child for greedy swine, would be my odds-on favorite for catatstrophic infrastructure failure due to neglect and incompetent operations
1-30-2009 @ 12:32PM
EJCServant said...
Why am I not surprised at this? This has been happening ever since the fuel increases, so of course they're setting record profits. Wow, we're really getting scammed and screwed. Yet, evidently, all of it is allowed and legal.
1-30-2009 @ 12:35PM
crhalt said...
BIGOIL$UCK$
150.00 a barrel=4.00 a gal.
48.00 a barrel=2.00 a gal.
here in California BIGOIL is still ripping us off at the pumps.
1-30-2009 @ 12:48PM
Michele said...
I saw a political sign in the 70s that read: Exxon/Nixxon,the same old gas.I still remember it everytime I see an Exxon sign. By the way,I voted for Nixxon.
1-30-2009 @ 12:58PM
Heather said...
SICK,SICK,SICK...
1-30-2009 @ 12:58PM
jwallstrom said...
Why are my energy mutual funds down when the oil companies make profits whether oil is up or down?
1-30-2009 @ 12:51PM
Michele said...
I just figured out what OPEC stands for. Oil Prices Extremely Corrupt.
1-30-2009 @ 1:04PM
AndyB said...
http://tonto.eia.doe.gov/energy_in_brief/world_oil_market.cfm?featureclicked=4&
Interesting facts.
1-30-2009 @ 1:14PM
Patti Chiarelli said...
I won't worry too much about Exxon. Since they gave Barack Obama $13 million for his campaign they are now are slated in the stimulus package to receive $2.3 billion for studying carbon emission capture technology. They have developed this technology already according to the Wall St Journal and will benefit from backing Obama by getting this research money. What irony! They will benefit from the whole global warming scam!
1-30-2009 @ 2:00PM
STEVE said...
YOU PEOPLE ARE IDIOTS! BIG OIL, AS YOU BRAIN-DEAD MUSLIN COMMUNISTS CALL IT, HAS MADE LARGER CONTRIBUTIONS TO OUR STANDARD OF LIVING THAN ANYONE ELSE. YET YOU DUMBASSES THINK THAT INDUSTRY SHOULD BE RUN AS A CHARITY. AS FOR BUILDING NEW REFINERIES, THOSE KNUCKLEHEADS IN WASHINGTON WILL NOT LET THEM DO THAT. THE TREEHUGGERS HAVE 'EM BY THE BALLS. GO BACK TO SLEEP.
1-30-2009 @ 2:09PM
diana said...
Huge profits for the oil companies and billion dollar bonuses for bank CEOs, while people are being layed off by the thousands every day, is the result of 8 years of Republican rule favoring big business. Congress needs to remove the tax cuts for big business that were added to the stimulus bill, pass the stimulus bill, and not worry whether or not the Republicans like it. It hurts Republicans to spend the people's money on the people even when there are no jobs to help pay for groceries, pay the rent or pay for health care.
1-30-2009 @ 2:13PM
jcstreet53 said...
Big Oil is at it again!
There needs to be a 10% surcharge on all oil company profits to help underwrite the Asmerican economy.
Big Oil profits from the usage of the oil that we import and refine. There is a need to share the pain during this transitional period in our economic history.
Exxon's annual profit of over $45Billion dollars needs to have at least $4.5 B returned to the federal treasury to offset the economic chaos that they have helped to create. This should be in the form of a tax that HAS TO BE PAID regardless of adjusted earnings.
Here again large salaries, large bonuses and pig like executive pay should be offset by this tax to assist in the modernizing of America's infrastructure.
Big Oil must pay to play - this time it is good for America.
1-30-2009 @ 2:20PM
daang7601 said...
Oil price remains hovering at $40 bbl is completely BULLSH!T!!!
1- Companies are shutting down filing bankrupt everyday on every corner around the world;
2-Power lines are damaged by freezing weather and won't get power back until the mid of February causing over millions of homes has stopped and are not using fuel;
hundreds of million of job cuts and unemployed; and oil-price remains to be hovering at $40 bbl... That is completely BULLSH!T!!!
Folks, let's FIGHT to wipe all these CORRUPT oil companies from the face of this Earth so the SCUMS of Wall Street will also CEASE to exist.. To do that, we must continue to cut down our fuel usage even GREATER or stop buying fuel whenever you can... These CORRUPT oil companies and Wall Street must CEASE to exist and wiped completely from the face of the Earth!!!! Keep cutting!!!
1-30-2009 @ 2:40PM
Rob said...
OF course they have a profit. When the price of gas goes down, their gas cost remains the same. Why are people so stupid and continue to buy gas at stations who charge beyond the average price in the US. Other stations who charge beyond the normal price are: Shell, who in my area when other stations have lowered to at least 1.89, still were charging 2.15. Texaco, same price. Stop buying gas at these stations. When the gas price drops, the prices remain the same. Prices go up 2 cents, they raise by 80 cents. The companies executives should all be jailed under RICO.