The price of gasoline and other combustible fuels has risen sharply. Recently, at least three of our representatives in Washington have mentioned by name ExxonMobil, saying that in 2004 the corporation made more than $20 billion (amounting to $3.89 per share) and was guilty of price gouging on gasoline. They also suggested that an "excess profits" tax be levied, specifically on ExxonMobil. To examine the validity of this claim, the 2004 ExxonMobil annual report was examined.
On page 19, the results of refining liquid products, including light naptha, gasoline, diesel fuel, home heating oil and heavier products, was given. A calculation shows that the actual average downstream product profit amounted to 5.3 cents per gallon. Federal and state taxes are about 42 cents, roughly eight times the net profit per gallon. The strange fact is that many people actually believe the price-gouging nonsense.
President Bush requested early during his first term that drilling for oil in ANWAR (the Alaskan Wilderness) begin as soon as possible. Congress did not permit drilling to proceed. Be sure to ask your representative in Washington how he/she voted on this critical matter. It is believed that there may be billions of crude oil in this pool, which could lower the price per barrel.
Robert L. Smith, Payson