Congress grills Big Oil on prices


Cross-posted on Reuters, IBS, USAToday, FoxNews

The top five oil companies, testifying before Representative Edward Markey's (D-MA) Select Committee on Energy Independence and Global Warming, insisted that their 125 billion dollar profit last was "in line with other industries."

Representative Markey's take on the profits:
“On April Fool’s Day, the biggest joke of all is being played on American families by Big Oil, while using every trick in the book to keep billions in federal tax subsidies even as they rake in record profits,” said Rep. Edward Markey, D-Mass. [video]

As reported in this article, Congress to drill for answers on oil prices, both the House and the Senate are holding hearings this week regarding the record profits by oil companies. The House hearings are focusing on the actual profits by the big five oil companies; Exxon Mobile, Chevron, ConocoPhillips, BP and Royal Dutch Shell.

The Senate investigation will be on the impact of investors on rising prices.

Lawmakers were looking for answers to the soaring fuel costs a day after the Energy Department said the national average price of gasoline reached a record $3.29 cents a gallon and global oil prices remained above $100 a barrel although supplies of both gasoline and oil seemed to be adequate.

In November, 2005, Hofmeister and the top executives of the same companies represented Tuesday, sat in a Senate hearing room to explain high prices and their h&uge profits. The prices are of concern, Hofmeister said at the time, adding a note of optimism: "Our industry is extremely cyclical and what goes up almost always comes down," he told the skeptical senators on a day when oil cost $60 a barrel.
Oil recently reached a high of $111 a barrel.

The increase in the price of gasoline is hitting all sectors of the American economy. Truckers, dependent upon high diesel prices, have been particularly hard hit, leading to an increase in the inflation index for the products they carry. This ranges from milk to hardware to the price increase announced by Delta Airlines today due to high fuel costs...