What Else Is New? Economy Slumps, Oil Profits Surge

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Posted on Jul 31, 2008

Despite the massive federal stimulus package, national GDP only grew 1.9 percent from April to June, the Commerce Department announced Thursday, and it actually shrank in the last quarter of 2007. Meanwhile, high gas prices, supposedly reflecting costs, spiked profits of oil companies, with Exxon recording its most profitable quarter ever. In fact, reports the NYT, “It was the highest quarterly profit ever for any American company, as Exxon made nearly $90,000 a minute.”

New York Times:

Such profits have made Exxon Mobil a target of politicians in recent years, propelling calls for windfall profits taxes to finance research and development for renewable fuels to replace oil.

The principal reason for the company’s banquet of riches is rising fuel prices. Crude oil prices in the second quarter averaged more than $124 a barrel, 91 percent higher than the same quarter in 2007, according to Oppenheimer & Company. Natural gas prices averaged $10.80 per thousand cubic feet, up 43 percent from the quarter a year ago.

But while high energy prices brought Exxon $10 billion in earnings from selling oil in the quarter, up about $4.1 billion or nearly 70 percent, not everything in its earnings report heartened investors. The company reported that its oil production decreased 8 percent from the second quarter of 2007, largely because of an expropriation of Exxon assets by the Venezuelan government and labor strife in Nigeria.

The company spent $7 billion, or nearly 40 percent more than the same quarter last year, to find and produce oil from new fields.

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TAGS: economy exxon gdp money oil oil profits profiteering profits recession shell slump

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By Purple Girl, August 1, 2008 at 7:18 am Link to this comment

The firs tproblem with ‘the Surge has Worked’ is that it infers past tense…Yet the troop levels indicate we are still in ‘The Surge’. Not to mention 4 Suicide bombers who killed about 60 just this week.
So I wonder What ‘Surge’ they are referring to that can be discussed in the past tense…The Surge in Oil Profits- 11.7 BILLION just in th e2nd quarter for Exxon alone!The undermined American Economy &Freedoms;, increase in Homeforeclosures, Bankruptcy, joblessness. Those qualify for having succeeded- it’s been a long battle for them over the last 3 decades- but they have finally conquered America.
As a Michigander, I like to refer to this operation as the PURGE.
When I hear ‘Conditions on the Ground’, I immediately think of the Conditons On OUR GROUND! AND WONDER WHO THEY ARE CLAIMING THEY HAVE DEFEATED!

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