Refiners Have No Excuse for Gouging At The Pump, Windfalls Should Be Returned to Motorists
Santa Monica, CA -- ExxonMobil's report of a record $8.4 billion in first-quarter profits demonstrates that skyrocketing gasoline prices are due to oil company profiteering, rather than the price of crude oil, according to the nonprofit Foundation for Taxpayer and Consumer Rights (FTCR). The oil company's continuously larger profits prove that prices at the pump have far outstripped the rise of crude oil prices and that public anger is entirely justified, said FTCR. Read the foundation's recent study on refinery profiteering.
Exxon's windfall should persuade politicians to take more effective action to protect consumers. Specifically, the group called for:
- A windfall profits tax that will rebate excessive profits to consumers;
- Regulation of the nation's supply of refined gasoline to prevent market manipulation;
- Modernization of antitrust laws (Read FTCR's expert's testimony before the U.S. Senate Judiciary Committee); and
- New funding to speed the development of alternative energy sources, similar to a proposed California ballot measure.
Exxon's quarterly profit, up 7% over last year's first quarter, was a record for any first quarter, but likely to be exceeded next quarter.
"The extreme run-up in pump prices since the beginning of April isn't even reflected here," said Judy Dugan of FTCR. "It will almost certainly push profits for Exxon and other refiners to yet another record. The companies need to be held responsible for their excessive refinery profits and their tight control over refinery output, which allows them to get away with this pricing. These companies have broken the law of supply and demand with their cartel-like behavior at the refining end."
The profit report itself shows that Exxon produced more crude oil in the first quarter than last year, but refined less. Read earlier data on refinery machinations at http://www.consumerwatchdog.org/energy/pr/?postId=6144 and at http://www.consumerwatchdog.org/energy/pr/?postId=5799.
In addition, California-based Valero Energy, which refines gasoline but is not directly in the oil business, posted a record 59% quarterly profit increase earlier this week -- the purest proof that refineries are profiting far above their cost for oil.
"Only by actually reaping some of the companies' windfall for American motorists and regulating the refining business can this oil company profiteering be brought under control," said Dugan.
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