Everyone Hates Big Oil

It seems like everyone is mad that big oil companies like XOM, BP, and CVX have been reaping record profits this quarter because of high crude prices, but I don't think it makes sense to blame the oil companies.

"Big oil behemoths are making out like bandits, while the average American family is getting killed by high gas prices, and soon-to-be record heating oil prices," Sen. Chuck Schumer, D-N.Y., said in a statement."

So… just because this company is making a ton of money, you expect them give free handouts to help subsidize energy costs for low-income families? That would be nice, but it really doesn't make sense. Did Exxon beg for free handouts 3 years ago when crude was $30/barrel? If Exxon were a state-run oil company like China's CNOOC, then yeah, I would expect them to give back to the people, but this obviously isn't the case. Exxon is NOT guilty of anything!

Of course, I hate high oil prices too… It costs me $40 to fill up my tank, and it's slowing down the economy, but it would make more sense to increase funding for alternative energy research than to whine about a successful company.

However, a reasonable point made against XOM is that they have been holding off on building refineries in order to artificially decrease supply.

Court said oil companies have strategically refrained from building new domestic gasoline refineries so that tight supplies would push up prices. "Now Exxon needs to invest that money in making more gasoline," he said. "Neither Exxon nor the industry has opened a new refinery since 1976 because the companies know keeping refined supply low is a recipe for huge profits."

Assuming this argument is valid, there still isn't much you can say. Exxon is a business, and the purpose of a business is to make money, not to make people happy.

Like it or not, that's capitalism.