New Quarterly Records Show Oil Companies ‘Spiting the Future For the Sake of Cash in Hand’
 
Santa Monica, CA — BP, the third-largest of the major private oil companies, saw its profits leap by $2 billion in the 2nd quarter, at the expense of the staggering U.S. economy and consumers worldwide, said Consumer Watchdog. Its quarterly record $9.5-billion net profit in the 2nd quarter was more than $2 billion higher than either its 2nd quarter 2007 net or its 1st quarter 2008 net. Even accepting BP’s various accounting deductions, the profit was a record.
 
“BP’s net profit near $10 billion for the quarter puts the company in Exxon territory, except that Exxon will report even higher profit records this quarter,” said Judy Dugan, research director for the nonprofit, nonpartisan Consumer Watchdog. “Congratulations are not in order, because the only thing necessary for reaping this windfall was access to oil. The result for everyone except BP shareholders and executives is the pain of fuel costs and price increases at the grocery store.”
 
As ExxonMobil, Shell and Chevron report profits this week, a picture of corporations reaping continuously higher profits without improving their businesses will emerge, said Consumer Watchdog. The companies have made comparatively little effort to develop new oilfields because it doesn’t contribute to the immediate bottom line, said Consumer Watchdog. Developing renewable energy replacements for oil was even lower on the priority list, of use mainly as publicity “greenwash.” As a recent AP story noted, the big-five oil companies plowed about 55 percent of the cash they made from their businesses into stock buybacks and dividends last year, while investments in new oil stayed in single digits.
 
“Oil companies that are collectively putting more than half of their cash into buying back their own stock, without first putting more into developing new energy sources, are spiting the future for the sake of cash in hand,” said Dugan. “The companies’ quarterly reports are a testament to management whose sole focus is short-term profits, not a long-term energy future.”
 
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See Consumer Watchdog’s database and charts of oil companies’ yearly profits since 2000 at: http://www.OilWatchdog.org. The database takes into account companies that merged after 2000, such as Chevron and Unocal in 2005, to give the fairest picture of oil profit increases.