Executives from the supermajors were called to Washington DC recently to justify receiving oil subsidies during record oil prices, where the top five U.S. companies saw $123 billion in profits in 2007. I can't blame Congress for being furious, with several oil companies posting record profits and still getting money from the government trough. And the oil industry itself should be wary of this practice, as it gives opponents of the industry a great weapon to use in the public arena. You have to realize that to the average American, oil prices equals only one thing: gasoline. Your average joe isn't aware of complex issues like spare capacity or the rising cost of drilling programs and such. And the media is either too biased or too lazy to point such things out on a regular basis because it's easier to just agree with the angry masses and say oil companies are greedy. The U.S. government currently gives $18 billion in tax breaks to companies, which the Big Oil companies claim are necessary to invest in exploration, and also they added that they need to make maximum profits during "good times" to help support them during the down cycles. I suppose there is something to be said for the fact that the laws restricting exploration may necessitate extra funds. So ultimately, Big Oil needs to give up the subsidies and the Congress needs to stop blocking exploration, and everyone will be happy. –Stephen Payne, Editor, Oil and Gas Investor This Week; spayne@hartenergy.com
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