Oil executives sought to justify their huge profits under tough questioning Wednesday, but they found little sympathy from senators who said their constituents are suffering from high energy prices.
"Your sacrifice appears to be nothing," Sen. Barbara Boxer, D-Calif., told the executives, citing multimillion-dollar bonuses the officials are receiving amid soaring prices at gasoline pumps and predictions of more of the same for winter heating bills.
There is a "growing suspicion that oil companies are taking unfair advantage," said Sen. Pete Domenici, R-N.M. "The oil companies owe the American people an explanation."
The executives represented five major companies that, along with their global parent corporations, earned more than $32.8 billion during the July-September quarter. Consumers, meanwhile, saw gasoline prices soar beyond $3 a gallon in the aftermath of supply disruptions caused by Hurricanes Katrina and Rita.
Lee Raymond, chairman of ExxonMobil Corp., the world's largest publicly traded oil company, acknowledged the high gasoline and home heating prices "have put a strain on Americans' household budgets," but he defended his company's profits. Petroleum earnings "go up and down" from year to year and are in line with other industries when compared with the industry's enormous revenues.
It would be a mistake, said Raymond, for the government to impose "punitive measures hastily crafted in response to short-term market fluctuations." They would probably result in less investment by the industry in refineries and other oil projects, he said.
ExxonMobil earned nearly $10 billion in the third quarter. Raymond was joined at the witness table by the chief executives of Chevron Corp., ConocoPhillips Co., BP America Inc. and Shell Oil Co.
But senators pressed the executives to explain why gasoline prices jumped so sharply in the aftermath of Hurricane Katrina, when prices at the pump in some areas soared by $1 a gallon or more overnight.
Sen. Bill Nelson, D-Fla., asked why the industry didn't freeze prices, as it did after the Sept. 11, 2001, terrorist attacks.
"We had to respond to the market," replied Chevron chairman David O'Reilly.
Raymond said that after Sept. 11 "the industry wasn't concerned about whether there was adequate supply," as it was after this year's Gulf storms. By keeping prices higher, adequate supplies were assured, he maintained.
Democrats said that during the storm some ExxonMobil gas station operators complained the company had raised the wholesale price of its gas by 24 cents a gallon in 24 hours.
Raymond said his company had issued guidelines "to minimize the increase in price" but added, "If we kept the price too low we would quickly run out (of fuel) at the service stations."
"It was a tough balancing act," said Raymond, who said ExxonMobil was not price gouging.
A number of Democrats have called for windfall profits taxes on the industry. Other senators, including Majority Leader Bill Frist, R- Tenn., have said it may be time to enact a federal law on price gouging.
Some Republican and Democratic lawmakers have suggested that the oil companies should funnel some of their earnings to supplement a federal program that helps low-income households pay heating bills.
That brought a cool reception from the executives.
"As an industry we feel it is not a good precedent to fund a government program," said James Mulva, chairman of ConocoPhillips.
The head of the Federal Trade Commission said a federal price-gouging law "likely will do more harm than good."
"While no consumers like price increases, in fact, price increases lower demand and help make the shortage shorter-lived than it otherwise would have been," FTC Chairman Deborah Platt Majoras told the hearing.
"That's an astounding theory of consumer protection," replied Sen. Ron Wyden, D-Ore.
Majoras said the FTC recently formally demanded documents and other data from many of the major oil companies in connection with investigations into pricing activities after Hurricane Katrina and into whether companies have manipulated prices by reducing refinery capacity. The refinery investigation was directed by the energy law passed last summer, with a report due to Congress in the spring.
Mulva of ConocoPhillips said, "We are ready open our records" to dispute allegations of price gouging. ConocoPhillips earned $3.8 billion in the third quarter, an 89 percent increase over a year earlier. But Mulva said that represents only a 7.7 percent profit margin.
"We do not consider that a windfall," he said Mulva.
Chevron's O'Reilly attributed the high energy prices to tight supplies even before the hurricanes struck. He said his company is "investing aggressively in the development of new energy supplies."
Shell earned $9 billion in the third quarter, said John Hofmeister, president of Shell Oil Co., but he said the company's investment in U.S. operations over the last five years was equal to its income from U.S. sales.
"We respectfully request that Congress do no harm by distorting markets or seeking punitive taxes on an industry working hard to respond to high prices and supply shortfalls," said Hofmeister.
-------------------- Spend Word For Word With Me And I Shall Make Your Wit Bankrupt.
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ok! Riesco, got one of your "reliable sources" so I'm taking "Associated Press" as a news source you believe as true so I'll put that down...
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Now that we know that RiescoDiQui believes the AP is a reliable source, here's another article from them.
*************************************************
Classified article questions Vietnam War buildup rationale
By The Associated Press 11.02.05
WASHINGTON — National Security Agency officers mistranslated interceptions involving the 1964 Gulf of Tonkin incident, and their mistake was covered up by deliberate falsifications, says a researcher trying to obtain an article that lays out what happened.
Now, says researcher Matthew Aid, the NSA is blocking release of the article, by an NSA historian, about the incident that led to a massive U.S. buildup in Vietnam by President Lyndon B. Johnson with the near-unanimous backing of Congress.
Aid, who requested the article last year under the Freedom of Information Act, said it appeared that NSA officers made honest mistakes in translating the intercepted messages about what was reported as a North Vietnamese attack on American destroyers in the gulf off the coast of what was then North Vietnam.
Rather than correct the mistakes, the 2001 article in the NSA's classified Cryptologic Quarterly says, midlevel officials decided to falsify documents to cover up the errors, according to Aid, who is working on a history of the agency and has talked to a number of current and former government officials about this chapter of American history.
Aid said he had been told that the article, written by NSA historian Robert Hanyok, analyzes problems found in interceptions about the events. He said the nature and extent of the mistakes remained unclear, and that some senior officials at NSA who were not involved with the errors had taken issue with the journal article.
Aid drew comparisons to more recent intelligence on Iraq's weapons of mass destruction that overstated the threat posed by President Saddam Hussein's arsenal.
"The question becomes, why not release this?" Aid said of the article. "We have some documents that, from my perspective, I think would be very instructive to the public and the intelligence community ... on a mistake made 41 years ago that was just as bad as the WMD debacle."
The NSA is the largest spy agency in government, responsible for much of the United States' code-breaking and eavesdropping work. In spy lingo, the agency collects and analyzes "signals intelligence" — "SIGINT."
The controversy over the article's release were reported first in The New York Times on Oct. 31.
In a written statement, NSA spokesman Don Weber said the agency had delayed releasing the article "in an effort to be consistent with our preferred practice of providing the public a more contextual perspective." The agency plans to release the article and related materials next month, he said.
"Instead of simply releasing the author's historical account, the agency worked to declassify the associated signals intelligence ... and other classified documents used to draw his conclusions," Weber said.
Many historians believe that Johnson would have escalated U.S. military action in the region anyway. At the time, the incident was regarded by some in the anti-war movement as a flimsy pretext for increased American involvement. On Aug. 5, 1964, Johnson announced to Congress that "the North Vietnamese regime had conducted further deliberate attacks against U.S. naval vessels operating in international waters" and that he had "therefore directed air action against gunboats and supporting facilities used in these hostile operations."
Congress then passed a joint resolution supporting the president in taking "all necessary measures to repel any armed attack against the forces of the United States and to prevent further aggression."
Steven Aftergood, director of the Federation of American Scientists project on secrecy, said events of the Cold War cannot remain off limits, effectively a secret history.
"A lot of what we think we know of our recent history may be mistaken," Aftergood said. "It is a disgrace that it should be so in a democracy, but it is."
James Bamford, who has written several books on the NSA, said the agency had a "lethargic attitude" about revealing historic information "that may be useful for people in the future, to help prevent mistakes."
posted
I thought the article was interesting... Show me a quote of me saying the AP was reliable. Don't assume you know me 4art... as best I can tell you are incapable.
-------------------- Spend Word For Word With Me And I Shall Make Your Wit Bankrupt.
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I thought the "Classified article questions Vietnam War buildup rationale" article was also interesting... Show me a quote of me saying that I know you. Don't assume you know me RiescoDiQui... as best I can tell you are incapable.
-------------------- Spend Word For Word With Me And I Shall Make Your Wit Bankrupt.
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LOLOL... listen my little third grade friend... If you are going to compete in the big league you will have to broaden your verbal strategy beyond repeating everything I say in the hopes it will frazzel me. Does your mommy know you are playing with her computer?
-------------------- Spend Word For Word With Me And I Shall Make Your Wit Bankrupt.
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LOLOL... listen my little third grade friend... If you are going to compete in the big league you will have to broaden your verbal strategy beyond repeating everything I say in the hopes it will frazzel me. Does your mommy know you are playing with her computer?
-------------------- Spend Word For Word With Me And I Shall Make Your Wit Bankrupt.
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quote:Show me a quote of me saying the AP was reliable.
I asked you in another thread because you constantly demand PROOF to tell us how you determine what is real, what is true and what you consider PROOF so we all can get a better understanding of how you interpret information.
Apparently you've never had to prove your point to someone, if you have then you must have gotten the proof from somewhere.
Whether it be real life experience or the newspaper...
You ask proof from others... You then post an article, apparently you posted it because you thought it was interesting.
Now if I were to say this article is BS prove everything in it, where would you start? Mayeb you would say you don't care, I was looking for an answer to my question because I am very curious to know your answer. I think others are as well.
posted
All I did was post an article... with no commentary. Since that happened you three have gone crazy fumbling over yourselves trying to get me to prove something... What the hell do I have to prove? I posted the article because I find it humorous to watch two inherently dishonest entities argue. Big oil and government. Seriously... what the hell are you three asking of me?
-------------------- Spend Word For Word With Me And I Shall Make Your Wit Bankrupt.
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By breathing 4art... by breathing... your mere... and meger exsistence is enough... the hate you spew the drivel you dribble. You are promoting a communist agenda for what end I have yet to decide. I do know that communism will bring death and despair.
-------------------- Spend Word For Word With Me And I Shall Make Your Wit Bankrupt.
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It's not that you are just anti-bush or anti-war it is that you are stating the government should have a very different role from what it has... I'm not as pro-bush or pro-War as you might think... Government in your ideal world would give equally to all... Government in my ideal world would do little more than offer limited governance of the states and fend off foriegn foes. That is our differences politically.
-------------------- Spend Word For Word With Me And I Shall Make Your Wit Bankrupt.
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RiescoDiQui: It's not that you are just anti-bush or anti-war it is that you are stating the government should have a very different role from what it has...
4Art: You mean the role of nation building? I'm against it, that's true!
RiescoDiQui: I'm not as pro-bush or pro-War as you might think...
4Art: That may well be true. I don't presume to know you, except in jest.
RiescoDiQui: Government in your ideal world would give equally to all...
4Art: Government in my ideal world would tax all equally and provide the same incentives for all. It would not provide huge tax incentives to corporations who outsource in order to avoid paying Americans a decent wage. That's just one example of many.
RiescoDiQui: Government in my ideal world would do little more than offer limited governance of the states and fend off foriegn foes.
4Art: So you're against nation-building too? Cool!
posted
No, I don't think so, you sound more libertarian. Which is what I am almost considering myself now that I have almost finished de-republicaning myself. Any suggestions on how to finish? I think you and I might actually think more alike than I originally thought. The rich would never let a flat tax fly, they'd lose too much.
-------------------- If it wasn't for bad luck I'd have no luck at all.
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quote:Originally posted by RiescoDiQui: Government would take in more money from a sales tax... which is the only reason I oppose it. Well not really oppose...
posted
I do sound libertarian, don't I? Huh. I used to think I was an independent, but I must be getting wiser. LOL
I don't have any suggestions except to look at all sides, admit when you're wrong, and gloat like hell when you're right.
(Just kidding about that last part... I think.)
quote:Originally posted by HILANDER: No, I don't think so, you sound more libertarian. Which is what I am almost considering myself now that I have almost finished de-republicaning myself. Any suggestions on how to finish? I think you and I might actually think more alike than I originally thought. The rich would never let a flat tax fly, they'd lose too much.
posted
Forget calling yourself a libertarian, Hilander, because that title has already been usurped by a bunch of weirdo types that advocate living in secret commune like places and practicing near religious sexual things.....and they write really bad books in really horrible English.
I, like you, would feel best. perhaps, if I could be a libertarian, but those weirdos won't let me, so there is no title for me to hide under.
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