Exxon Mobil Profits Soar to Highest Levels Ever, But Production Falters
Aug. 1 2008
Exxon Mobil reported the highest profit of any corporation in U.S. history, beating its own records, although most news accounts chose to highlight the "disappointment" among the company's investors upset with the result since it was lower than Wall Street's lofty expectations. The world's largest publicly traded oil company reported $11.68 billion in second quarter profits, nearly $90,000 a minute over the quarter. Crude oil prices averaging more than $124 a barrel for the quarter, 91 percent higher than the same quarter last year, drove profits to record levels. Exxon reported revenues of $254.9 billion for the first six months of 2008.
Exxon's total profits amounted to $22.57 billion excluding an after-tax charge of $290 million related to the $500 million settlement for the Exxon Valdez disaster, a vastly reduced punishment compared to the initial $5 billion jury award.
"Inside the boardrooms at the major oil companies, it's Christmas in July," said Senator Charles E. Schumer, Democrat of New York. "What's shocking is that Big Oil is plowing these profits into stock buybacks instead of increasing production or investing in alternative energy."
Kenneth Cohen, an Exxon vice president, said oil companies need the profits to search for more oil and gas, repeating industry talking points and calling on Congress to open up protected federal lands and offshore areas where drilling is prohibited.
But Exxon purchased $8.8 billion of its own shares over the quarter, twice as much as the company spent on exploring for new oil fields. Exxon and other oil companies have failed to explore for oil on 80 percent of the millions of acres of public lands already leased to them by U.S. taxpayers.
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