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Big Oil Answers to Congress

Feeling Gassy? The Government Is Too.

It's no secret that gas is completely expensive. This week the news about it has been a gusher. Big Oil execs were called in front of Congress to explain the hit we're all taking at the pump. What else? Oh, the truckers went on strike showing us how high gas prices can also send commerce to a screeching halt, and we found out ethanol is not the wonder-fuel everyone hoped and could actually be making the food and environment problems worse. Awesome.

Surely all that is just coincidence right? The energy and environmental problems aren't that bad. Well, yesterday 18 states filed to take the Environmental Protection Agency to court saying that even though the EPA was faced with a Supreme Court ruling to regulate greenhouse gas emissions, including carbon dioxide from motor vehicles, they've done nothing. 18 states. Suing. The EPA. For not protecting the environment. Oh golly.

If you're curious to see what Big Oil had to say for themselves,


Senior VP of Exxon Mobil (whose company last year raked in the largest profit in U.S. history at $40.6 billion) explained that his company needed the huge profits to pay for future oil development. Oh. Well as long as there's a good reason right?

Big Oil claims that their profit margins are comparable to other industries, and the execs went on to questions as to why that money is paying for oil development instead of focusing on renewable sources. Exxon Mobil said that they're giving some ($100 million) but until renewable sources become more economically competitive, the company will focus on its core oil business. Chevron allowed that the US would be getting 86 percent of its fuel for at least the next 25 years.

One solution offered? The execs said one way to ease prices was to grant access to off shore deposits. They are presently off limits due to some pesky negative environmental impact or some such. Representative Emanuel Cleaver, (D-MO) probably summed it up best when he told these executives, “Your approval rating is lower than ours, and that means you’re down low.”

Are we ready to start walking everywhere yet?


Join The Conversation
LadyAngel89 LadyAngel89 9 years
Everyone pushes for more money, then everyone pulls to help those with no money. Unfortunately we just keep getting pushed and pulled and fluffed until our dollars aren't worth the paper their printed on anymore.
hausfrau hausfrau 9 years
2M - Here's something that speaks to the point of who gets what of the cost of a gallon - It comes from the DOE, so it seems reliable... I thought the taxes varied state to state though...
hypnoticmix hypnoticmix 9 years
Well I'm certainly no expert MrinerMandy but a third of the cost of a barrel of oil is what the market refers to as projected risk. At least that is the way President explained it. So if we can eliminate and unnecessary future risk like unnecessary war, Georgie!, that's a lot of money off the price of a barrel of oil. Hey and combine that with everyone conserving. Combine that with mainstream hybrid production my God gas will be dirt cheap.
MarinerMandy MarinerMandy 9 years
My future father in law goes off on this subject all the time blaming liberals for the high gas prices, but I have taken a few points away from his arguments and not having researched any of this myself (too complicated, and honestly, boring) I'm curious if anyone can comment. He says that oil companies are making less than a dollar per gallon on the gas we buy and the rest is taxes. He says that another aspect of the problem is that the liberals in congress keep closing refineries. I used to have a cute little Civic that got 37 miles to the gallon city driving...then it was totalled in an accident and I've been stuck driving my fiance's Taurus at 21 miles to the gallon. I miss the days when we were all complaining that gas was creeping up to $2/gallon!
hausfrau hausfrau 9 years
Oh I know right! Remember when you could say "eh, I'll just put 5 bucks in..." That used to get me almost to a half a tank!
hypnoticmix hypnoticmix 9 years
Yes, rural transportation needs are a key element to take into perspective. Super Unleaded, huh. When I started driving in 1989 Super in So. Cal. was .98 a gal. Ah, those where the days.
hausfrau hausfrau 9 years
Thats a lot better! I agree with you on the second point too... but I don't think people who live in urban areas or even the suburbs really understand how impossible it is for people who live in rural areas... It takes me 20 min of driving just to get to Target! I have to put super in my car, trust me, if I could walk or take a subway, I would!
hypnoticmix hypnoticmix 9 years
Alright well let me put it another way. I hope that one day all the U.S. auto manufacturers will get together and say hey you know what hybrid technology has proven its worth lets make it mainstream. How's that? ;-)> I still believe though it is ultimately up to all of us and that by acting on a united front and refining the way we travel day to day will ultimately have the greatest impact for all.
hausfrau hausfrau 9 years
And as I said before in some post, I'm a big believer in positive reinforcement. We're doing a good job giving tax cuts and special privaledges to people who drived hybrids (and not those who drive diesel, but thats a different irratation of mine) but I think we should give more incentives to buy those cars.... just in case all of that and the price at the pump isn't enough!
hausfrau hausfrau 9 years
Ohh ok, well I still disagree based on my free market ascertation... but I thought you were going to go swashbuckling through the street Gestapo style and take away everyone's gas engines... kinda like some people want to do with guns ;) But we have to remember too that hybrid technology is still very new and we haven't seen any long term reliability tests on those engines, whereas diesel has been around forever, its tried and true... So if we're gonna need some form of gas anyways, they should both be given an equal shot.
hypnoticmix hypnoticmix 9 years
As for the free market. The market doesn't care what you make as long as the market gets money. So, I'm sure the market will be just fine consuming the money from the sales of hybrid cars just as it's happy consuming the money form all gas cars.
hypnoticmix hypnoticmix 9 years
The hybrids are more expensive now because they're a specialty. Once they become mainstream the prices will drop.
hypnoticmix hypnoticmix 9 years
cabaker27 do you know how many nice used all gas engine cars will be available for sale for years to come. I think those families will be just fine. I took it as a give in my first comment but let me clarify that I was referring to the sale of new cars not used cars. I'm not suggesting banning the use of all gas engines already in existence. I'm simply suggesting banning the sale of new all gas cars.
hausfrau hausfrau 9 years
Hypnotic I could not possibly disagree with you more about banning the sales of gas engines. Think of all the families who can barely make ends meet now and NOW they have to buy a new car too?? Not to mention that hybrids are usually more expensive than regular gas engines and more costly to maintain.... AND diesel engines are just as efficient and clean as hybrids and they less costly to maintain, but because everyone pictures big trucks with plumes of black smoke, they don't get the media coverage... Even if none of that is true, you still cant regulate the market like that. It goes against everything a free market stands for.
hypnoticmix hypnoticmix 9 years
I think I've mentioned this before a couple of weeks ago under another topic. Since hybrid technology has proven its worth and is being used in vehicles from sub compacts to full sized S.U.V's, it is my opinion that congress should move to ban the sale of all gas engine cars in the U.S. by 2012. BMW has put into full production a hydrogen powered mid sized sedan. I'm interested to see how this technology will prove its worth as well. I'm sure it will since BMW has a certain reputation to up hold and wouldn't put something out there that they weren't positive they had a market for. Again I hate to sound redundant but if we all adopt a conservationist life style and push for excellence in innovative public transportation projects. We can have a much greater impact in this area of petroleum prices than any Presidential or CEO directive can. On a side note I've been following the nearly twenty year push to get high speed rail in California. The benefits of such a system here in California would be simply amazing. Problem is the government has never been willing to fund the project. Well this morning I read some good news. Foreign investors met with project leaders here in Calif. and with international help Calif. is getting her high speed rail. The system is projected to be completed by 2020.
redegg redegg 9 years
Hi 3M! :wave:
cine_lover cine_lover 9 years
It is very convienient for the people who live in New York, at least around the city, Long Island area, that is, to get into the city itself. Long Islands public transit itself sucks. However, if you live in New Jersey, it is easy to get to the city during peak hours, but if you want to go out for the night you have to drive because the public transit stops working at Midnight. To be honest I have no idea how eco friendly the public transit is, but for the most part they keep the trains and subways relatively clean. My company does not subsidize, but some do, although I think it is becoming less frequent. "It is not government's job to tell the oil companies how to do business (within reasonable limits). It *is* their job to maintain public services. Looks to me like they're wrong on both counts, here." -I completely agree.
Cassandra57 Cassandra57 9 years
cine, I can't believe New York public transit is that expensive! Is it at least clean and convenient? Do employers subsidize? It is not government's job to tell the oil companies how to do business (within reasonable limits). It *is* their job to maintain public services. Looks to me like they're wrong on both counts, here.
mymellowman mymellowman 9 years
Hi Red, :wave:
raciccarone raciccarone 9 years
You know, when you appoint an oil lobbyist to run the EPA, you just expect they'll do a better job.
redegg redegg 9 years
I've read articles in Forbes at least 6 months back saying biofuel is no good. Just waiting for it to trickle through the media and here it is!
cine_lover cine_lover 9 years
Lain- the public transit in Los Angeles is HORRIBLE! I attempted it once, and that was all I could take. The problem here in New York is that it is insanely expensive to drive OR take public transit. It basically cost me $10 a day to get to work, and I take public transit, AND I walk about a mile to get to my office (by choice. I could transfer and take another subway, but I like to walk) It is just ridiculous! If there is no real incentive to take public transit, then people are going to prefer to be in the comfort of their own car.
syako syako 9 years
Lain - I totally agree. Where I live we don't even have side walks in most places! And we have such a terrible case of urban sprawl that even if there were sidewalks you'd have to walk for hours to get from your home to your place of work. Point being - another area of focus should be to get mass transit that is reliable and safe so that commuters won't have to rely on cars to get to work every day!
Cassandra57 Cassandra57 9 years
I'm as cranky as anyone about gas prices (and how that affects the price of so many other things, like groceries). However, expecting oil companies to develop alternate fuels is like expecting a cigarette company to invest in stop-smoking research. It's counter to their revenue stream. However, if there are any hints of collusion or price fixing, I say hang 'em. I don't know how most of the US is, but mass transit in Los Angeles is staggeringly bad. Bus routes don't connect, there are long waits between buses, and sometimes they don't show up at all. A recent study (heard on the radio) showed that it takes 2 - 3 times longer to get somewhere by public transit than by driving. (I also drive a Camry--old and paid off!) That's a major difference between here and Europe. In the short term, I think there should be some incentives to build and update refineries. Long-term, I would love to see all-electric cars, with the power generated by nuclear plants.
megnmac megnmac 9 years
Did anyone see the Daily Show's montage last night on this? I bust out laughing as they showed the (sometimes lame) Congresspeople admonishing Big Oil, and then showed that they'd said much the same every year. And that oil said much the same every year. It just highlights how much of Congress is just for show...
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