Losses Elsewhere Offset by High Gasoline Profits in U.S., Especially West Coast
Santa Monica, CA — BP today blamed its 17% first quarter profit drop on everything but its bumbling management: lower natural gas prices, lower production, refinery outages. What it buried in it’s profit data was a doubling of U.S. West Coast refinery margins (which are mostly profit) from $11.22 to $22.21, said the Foundation for Taxpayer and Consumer Rights.
“The company at least owed a thank-you to motorists in California and Washington State, who kept their results from looking even worse,” said Judy Dugan, research director of the nonprofit, nonpartisan FTCR. “California and Washington State are paying the highest prices in the nation.” Washington State’s governor and attorney general launched a price probe yesterday, but California’s elected officials remain in a mode of “hear no evil, see no evil and especially speak no evil” about gasoline prices, said FTCR.
California’s average price is $3.34 a gallon, up 16 cents from a month ago and Washington State is at $3.15, even though Washington uses plain regular gasoline, with no clean-air additives. BP‘s “indicator” profit margins on refining also rose elsewhere in the United States, but not as much as in the West.
BP has been savaged for its shoddy maintenance, which resulted in an Alaska pipeline shutdown last year and a 2005 explosion that killed 15 people at a Texas refinery. Last week, a Texas judge harshly criticized BP for sending cheery monthly newsletters to at least 900 local residents who could have been called as jurors in civil trials involving the Texas City explosion.
This year, BP is under fire from FTCR and others for attaching unacceptable commercial strings to a half-billion dollar university grant at UC Berkeley. And at BP‘s recent shareholder meeting, a surprising one-fifth of shareholders protested lavish executive pay in the face of egregious health and safety lapses.
Analysts seemed to regard BP as an anomaly, and predicted U.S.-based oil companies Conoco, Exxon and Chevron would likely continue their astronomical profit runs, whether or not they hit new records. FTCR noted that BP‘s drop from the first quarter of the year still nearly matched BP‘s record set in the fourth quarter of 2004. This year’s profit was $4.7 billion compared to 2004’s $4.9 billion.
“Oil company profits have been so obscenely high for the last four years that even a 17% drop by the worst-managed of the global oil companies still results in a profit level that was unimaginable five years ago,” said Dugan.
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