Exxon Posts $10.9Bn Profit
By Steven Mufson
Concord Monitor
Bolstered by record crude oil prices, Exxon Mobil Corp. yesterday reported huge first-quarter profits and fueled new congressional vows to come up with legislation that would tax windfall profits or demonstrate concern about high gasoline prices.
The oil giant earned $10.9 billion in profits, up 17 percent from the previous year. The amount was short of the all-time record Exxon set the previous quarter but high enough to put it on the defensive amid consumer ire and congressional indignation.
“Crude prices are at historic highs, and we recognize that they are having a significant impact on many in our society through higher gasoline prices and higher energy costs in other sectors,” said Exxon’s vice president for public affairs, Kenneth Cohen. He warned, however, that “high prices also have the potential to result in bad public policy, such as windfall profits tax, that will hurt consumers in the long run.”
But Sen. Charles Schumer, a Democrat from New York, who has proposed such a tax on oil companies, issued a statement saying:
“Once again, consumers’ pain is Exxon’s gain. Oil companies are racking up obscene profits left and right while American families are stretched to the limit by skyrocketing gas prices. It’s high time for Big Oil to pay its fair share.”
Separately, the Federal Trade Commission said that it would take the first step in considering how to use new powers to prohibit market manipulation in the petroleum industry.
“We understand that consumers are being hurt by high gas prices, and the Commission remains vigilant in using its full authority to prevent unlawful behavior that affects gas prices,” FTC Chairman William Kovacic said.
As colossal as Exxon’s quarterly profit was, the company’s stock fell yesterday amid sliding oil prices, as investors appeared to shift gears, pull some of their money out of commodities and turn to stocks.
The price of oil and other commodities – including copper, gold, natural gas, lumber and wheat – fell broadly while the stock market surged. Crude oil, by contrast, slid for a third straight day, dropping 94 cents a barrel to $112.52. Exxon Mobil stock fell $3.37 a share to $89.70.
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