Gas is up around $4 per gallon and the U.S. public is feeling the pain. With crude oil hitting $130 per barrel today, oil execs were called before a Senate Judiciary panel today.
Fearing that soaring prices could cause the economy to slip into a recession, the Senate is looking to the big oil companies for possible relief for American families. A recent report on CNN described the hearing:
The committee grilled executives from Exxon Mobil (XOM, Fortune 500), ConocoPhillips Co. (COP, Fortune 500), Shell Oil Co. (RDSA), Chevron (CVX, Fortune 500) and BP (BP) as to how their companies can in good conscience.
The executives said it did, and that they are doing all they can to bring new oil supplies to market, but that the fundamental reasons for the surge in oil prices are largely out of their control.
“We cannot change the world market,” said Robert Malone, chairman and president of BP America Inc. “Today’s high prices are linked to the failure both here and abroad to increase supplies, renewables and conservation.”
Malone’s remarks were echoed by John Hofmeister, president of Shell.
It is no secret demand is increasing, and supply is decreasing. I feel the pain of these CEOs, but this is the question – will the price of oil ever go down? Is there a fundamental issue that will keep oil prices going up and up?
We should of course be working on conserving oil, finding new sources and looking at renewables, but these things all take time. They are not going to happen this summer or even this year.
Afterall, they are still earning record profits. According to a report by Time:
But you just can’t keep Big Oil down. Trouncing analysts’ expectations Tuesday, BP and Royal Dutch Shell, Europe’s largest oil companies, delivered record profits for the first quarter of 2008. Anglo-Dutch firm Shell netted $7.78 billion in the first three months of this year, up 12% over the same period in 2007. Profits at rival BP, meanwhile, swelled by almost half to $6.59 billion. Shares in each firm climbed almost 5% on the news.
Perhaps they could loan us some of their profits while they help us, the American people, move to a less oil-dependent society.
I just need about $50 per week.