The fourth-quarter performance capped a record year for oil companies driven by a surge in crude oil and gas prices. Crude oil prices rose 40 percent last year, driven by rapidly rising demand from economically rising countries like China and India and production problems in oil-producing countries like Nigeria and Iraq.
Total revenues for the quarter reached $99.66 billion from $83.37 in the year-ago period.
Now, one of the reasons for this increase is that oil is sold on the commodities market, and if you are selling the most precious commodity in the world, people will pay a premium for that, and oil is the most precious commodity right now. Think about it, you can live without gold, but try living without oil. It's a tad bit tougher.
That being said, it's time we installed a windfall profits tax on the oil companies. One with some teeth, no hiding profits in overseas shell companies. And the republicans in Congress should probably stop giving these guys massive subsidies as they did in last year's Energy Bill. From the Washington Post:
It also includes an estimated $85 billion worth of subsidies and tax breaks for most forms of energy -- including oil and gas, "clean coal," ethanol, electricity, and solar and wind power. The nuclear industry got subsidies for research, waste reprocessing, construction, operation and even decommission. The petroleum industry got new incentives to drill in the Gulf of Mexico -- as if $60-a-barrel oil wasn't enough of an incentive. The already-subsidized ethanol industry got a federal mandate that will nearly double its output by 2012 -- as well as new subsidies to develop ethanol from other sources.
While subsidies are necessary to promote alternative sources of energy, in fact they are a must for the continuation of the human race, it's tough too keep giving them to oil and gas companies who simply throw them on their current pile of profits.
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