Ken Stiefel – 2/9/06

This page was last updated on February 9, 2006.

Take hard line on oil profits; Ken Stiefel; Beaver County Times; February 9, 2006.

This is Mr. Stiefel’s second letter regarding his displeasure with the oil industry. His August 25, 2005, letter was entitled “Mark your 2006 calendars.”

In the interest of disclosure, I worked for Texaco for over 22 years. Mr. Stiefel doesn’t tell us for whom he works/worked.

Below is a detailed critique of the subject letter.

“Exxon/Mobil reported profit earnings for the fourth quarter - $10.17 billion. Its total profits for the year were more than $36 billion. It continues to make these outlandish profits, and we continue to pay through the nose for gasoline prices.

“The company reported profits of $9.9 billion for the third quarter, up 75 percent. The Senate decided to call a hearing to investigate these extremely high profits. It asked, is this not price gouging? One senator stated the oil companies owe the American people an explanation.”

[RWC] I know folks like Mr. Stiefel don’t like to hear this, but U.S. oil companies don’t set prices. International oil and gas traders set prices when they bid on oil purchases.

Mr. Stiefel seems to forget the U.S. government gets about 40% of those “extremely high profits.” State governments also get their bite.

The Senate was grandstanding. Every senator knows exactly what happened and why. It’s simple economics.

“Exxon Chairman Lee Raymond said he recognized that the high gasoline prices, ‘has put a strain on the American’s household budgets.’ However he defended his company’s high profits.

“The Senate hearing didn’t appear to have much of an effect on the oil companies. They continue to go about business just as they please.”

[RWC] That’s because the oil companies didn’t do anything wrong.

“As with too many of these hearings, the struggling working class sees no positive results from the proceedings. These giant corporations continue to grow more and more profitable, and their executives continue to reap multi-million-dollar bonuses on top of their multi-million salaries.”

[RWC] I wonder if Mr. Stiefel writes letters during those times when the oil companies aren’t “more and more profitable.” He also seems to ignore the hundreds of billions dollars the oil industry invests to explore for and produce oil and gas.

“American companies continue to void pensions and health insurance plans promised to their workers over long periods of time. Hard-working Americans continue to lose ground in their effort to support their families as companies continue to demand wage concessions and outsource a large portion of U.S. jobs.”

[RWC] What does this have to do with the oil companies? The “outsource a large portion of U.S. jobs” is either a lie or was written out of ignorance.

“As this trend continues with no solutions in sight, you have to wonder why the present administration is doing nothing to hold these companies responsible for their actions. When will the federal government take a really hard line on these situations?”

[RWC] OK, exactly what did the oil companies do that was either illegal or unethical?