The market has spoken; it’s time to end Big Oil subsidies

The release of oil and gas companies’ 2Q profits has shed light on some elected officials’ true positions on deficit relief. During the debt ceiling debate, Big Oil-backed politicians like Sen. John Barrasso (R-WY) and Rep. Doc Hastings (R-WA) consistently protected their corporate sponsors, instead of American families. When everyone was looking for ways to reduce deficit spending, these politicians went out of their way to defend oil and gas subsidies. This, as opposed to cutting them and saving Americans nearly $45 billion over the next 10 years.

Last Wednesday, Hastings said the market should determine when subsidies should go away.  Sen. Barrasso said that it was okay to address ethanol subsidies, but that taxpayer handouts to his Big Oil campaign contributors could only be addressed as part of a larger tax deal.

Well, it seems that the markets have spoken and the time is ripe for getting rid of oil and gas subsidies. ExxonMobil’s 41 percent increase in profits from 2010 and Dutch Royal Shell’s 97.7 percent, multi-billion dollar increase from 2010 prove it is time to end their corporate welfare.

2010

2011

Percentage Increased

Oil Company  Q1 Q2 Q1 Q2 Q1 Q2
ExxonMobil 6.3 7.6 10.7 10.7 69% 40%
Royal Dutch Shell 4.9 4.5 6.9 8.0 40% 93%
ConocoPhillips* 2.3 4.2 3 3.4 30% -19.0%
BP** 5.6 -17 5.5 5.3 -1% N/A
Chevron 4.6 5.4 6.2 7.7 34% 42%
TOTAL 23.7 4.7 32.3 35.1 174% 115%

(All amounts in billions)

*ConocoPhillips said its earnings would have been 38 percent higher than 2010 Q2 earnings if the 2010 Q2 results for the Russian investments had been stripped out.

**BP’s 2010 Q2 earnings reflected a pretax charge of $32 billion to cover costs relating to the Gulf of Mexico oil spill disaster. The company’s earnings for the Q2 of 2011 was $22.6 billion.

The top five oil companies have made nearly $67.4 billion in profits so far this year – that’s almost double of their 10-year welfare package from the U.S. taxpayers.

When American families are being asked to take cuts in Medicare and Social Security in the debt and deficit debate, it is unconscionable to pay over $4 billion a year in taxpayer subsidies to Big Oil. It’s time politicians realize that and protect the people who they represent, instead of the companies who support them.

2 Responses to The market has spoken; it’s time to end Big Oil subsidies

  1. Pingback: Obama: Oil and gas corporations are not people « The Checks and Balances Project

  2. Pingback: THE BALANCE SHEET | Aug 10, 2011 « The Checks and Balances Project

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