OIL EXECS LASH CRITICS OVER PROFITS

Texas Tea Profitable

Washington, (WPI) - Thanks to soaring consumer oil and gas prices, ConocoPhillips posted an astonishing 51 percent gain in profits for the fourth-quarter on Wednesday, providing Americans a glimpse of what is anticipated to be an absolute bonanza for the oil industry.

The Houston-based company's earnings reached $3.68 billion, or $2.61 per share, compared with $2.43 billion, or $1.72 per share a year ago in spite of production problems left over from hurricanes Katrina and Rita.

Barely three months ago ConocoPhillips reported 3rd quarter profits up almost 90 Percent to a record $3.8 billion, or $2.68 a share. Full-year profits jumped to $13.53 billion, up from $8.13 billion in 2004.

ConocoPhillips is the nation's third-largest integrated oil company behind Exxon Mobil Corp. and Chevron Corp.

Criticism began almost immediately after the company reported earnings. From Senators, to Congressman to Attorneys General, to transportation companies and even the forgotten consumer a loud objection was raised at what Americans perceive to be price gouging by the oil industry.

Apparently having taken a lesson from the sweeping and damning attacks the industry suffered after its third quarter results were announced, this time the industry was ready to counter-punch its critics.

ConocoPhillips spokesman Chuck Yoo told World Press International, “This is still a market driven economy. Supply and demand are what determines prices. The average American simply doesn’t understand the pricing cycle of oil products.”

“When you criticize an oil company you are actually criticizing millions of hard working Americans. Oil companies are not owned by a few very wealthy investors, we are not owned by big Wall Street investment companies,” asserted Yoo. “No, oil companies are owned by thousands of regular Americans through their pension plans, their 401k programs, mutual funds and day trading. These are the people, hard working, average American families, that are being condemned when it is claimed that we are price gouging. Gouging WHO, I might ask?" Yoo pressed.

“Let me explain,” he continued, “If you have a pension or 401k retirement plan of say, $250,000 you have likely diversified it into five types of mutual funds. One of those is likely a utility or energy stock fund. So you have about $50,000 invested in energy stocks!” claimed Yoo.

“Of that $50,000 probably a third, or $16,333 is invested in actual oil companies. At our average share price this year of $57.50 that is about 284 shares! With dividends of almost $10 per share for the year the average American will earn about $2840!” Yoo gushed, “That is nearly $3000 for every American with a retirement plan! Do you think THEY don’t like our profits.”

The Government Accounting Office has claimed that fewer than 40% of Americans are invested in company pension plans, 401k retirement plans or invest on their own. The GAO also reported in November that the bottom 20% of the working public will likely have to choose between food and paying their energy bill at some point this winter.

The American Investment Council disagrees with Yoo’s conclusions however. Brad Haredae, spokseman for the Council which tracks investment statistics, said that while oil companies do have thousands of investors only a few matter.


“The total number of small investors, those with fewer than 1000 shares is about 1% of ConocoPhillips shareholders. About 60% of the company is owned by a few families or individuals and the rest is owned by Wall Street investors, including mutual fund companies,” Haredae claimed.

“Mutual fund shareholders and individual investors will NEVER get a seat on the Board of Directors!” Haredae laughed.

Over the past year consumer energy prices have skyrocketed. In September the Consumer Price Index saw the largest increase in 25 years. The report claimed that consumer costs for energy shot up by 12 percent, led by a 17.9 percent surge in gasoline prices. Home heating costs have nearly doubled. The average American is spending about $4200 more this year for energy than last year.

“That is exactly the point, “ Yoo replied to the data, “Who wouldn’t want that extra $3000?”