Don’t blame us: That’s the plaint from every quarter as gasoline/diesel prices set new records almost daily.
• Not our fault, oil company execs tell senators waxing indignant at a Capitol Hill hearing on the industry’s record profits, while $4 gasoline and almost-$5 diesel play havoc with every nook and cranny of America’s economy.
“Just fundamental laws of supply and demand at work,” said Shell Oil’s president. “We and our employees have to pay these pump prices, too,” said another.
And, if the tree huggers, whale fanciers, tundra protectors, polar bear lovers, and the evil EPA would just leave us alone so we could drill in the Arctic and offshore, it would be a different story, by golly.
Besides, much of our profit is being passed on to our legions of stockholders, who are then better able to afford groceries and everything else being inflated by the cost of oil.
One of the oil execs, responding to a senator’s query about “obscene profits,” said most of the money is being plowed back into searching for more oil (nudge-nudge, wink-wink).
• Don’t pick on us, say the Saudis, we’re just providing a commodity and the marketplace determines its price (this, as they gold plate everything in sight and spend mega-billions transforming their desert kingdoms with shiny new skyscrapers, high-end shopping malls, amusement parks, and ritzy real estate developments catering to the rich and famous).
No sympathetic ear did they lend when our president recently spent millions of U.S. taxpayer dollars on a junket to the Mideast, hat in hand, to plead for the Saudis to increase oil output. No can do, said they (how’s that for gratitude for the years of protection the U.S. has provided for their oil exports?).
Besides, the Saudis said, even if we sent more oil, you don’t have the refining capacity to handle it; you haven’t built a single new refinery in 30 years.
• Well, gee, the oil companies moan, refining is such a cyclical business, and for the longest time we weren’t making enough money on our refineries, so we just shut down a bunch of them. And we really, really would build some modern new refineries … but there are all those nasty federal regulations, and protesters chanting “not in my back yard.” We’re just victims of circumstances, and it’s only coincidental (nudge-nudge, wink-wink) that limiting refining capacity helps us to control price.
Meanwhile, in India, the world’s largest refinery, costing $6 billion, is about to come on line. Its entire production of high value fuels will go to export, primarily the U.S. and Europe. In a touch of irony, the owner, Reliance Industries, one of India’s most successful businesses, started as a textile operation. Its CEO is reported to be building a house in Mumbai that cost $1 billion.
• Don’t make us the whipping boy, say the speculators, who’ve made billions trading in oil futures. Hey, we’re filling a market need, assuming risk, providing price discovery. It would be much worse without us. Yadda, yadda.
And so it goes. Nobody’s to blame. Now, don’t we all feel better?