The People of America's Oil and Natural Gas Indusry

Energy Today - May 2, 2011

Rayola Dougher

Rayola Dougher
Posted May 2, 2011

ExxonMobil Perspectives: Where Do Your Gasoline Dollars Go?: Many in Washington would like motorists to think the high prices they are paying at the pump these days are flowing directly into the pockets of ExxonMobil and other oil companies. This misperception helps fuel the demonization of "Big Oil" and the misguided notion that energy prices can be solved by raising taxes on the oil industry. But the facts prove otherwise. Because of gasoline taxes paid by motorists, the government takes in far more money on a gallon of gasoline than an oil company does. How much more? Through the combination of state and federal taxes, the government collects an average 48 cents on each gallon of gasoline sold in the United States. Daily World: Oil Can Put Us Back to Work: The old rule of thumb says each $1 increase in the price of oil gives Louisiana $18 million in revenue, although budget-makers must stick to the last conference estimate. The rise in oil prices creates a powerful incentive to put Acadiana people back to work after more than three years of hard times created by the Great Recession, the BP oil spill and the deepwater drilling moratorium. We hope the federal government will hasten and not hinder the process of rejuvenating the region's economy and enhancing the nation's energy independence.

Alachua Today: Energy Resources are in Our Backyard: The construction of the proposed Keystone XL Pipeline, which will connect an abundant supply of Canadian crude oil with U.S. refining markets, is an essential opportunity we should seriously consider. The pipeline could reduce our dependence on oil from Venezuela and the Middle East by up to 40 percent, fostering much-needed economic growth. Canada is our largest trading partner and an influx of Canadian oil resources will make a significant difference in the U.S. The Canadian Research Institute estimates that the oil sands in Canada could generate nearly 340,000 new U.S. jobs while adding billions to the U.S. GDP over the next five years. With unemployment still very high throughout the U.S., Americans will stand to benefit from the jobs the pipeline could create.

Carpe Diem: Clarification About Oil Company "Subsidies" and Oil Companies "Not Paying Their Fair Share" of Taxes: In addition to the misunderstanding that oil companies somehow receive direct subsidy payments from the government like the payments some farmers receive (sometimes for NOT growing certain crops), there is also the misunderstanding that oil and gas companies are "not paying their fair share" of income taxes. The assumption here must be that other companies or U.S. industries are paying "their fair share" and oil companies "get off easy." The chart above is based on data from the API and shows that oil companies face a much higher income tax burden as a share of before-tax earnings (41.1%) compared to other S&P Industrial corporations.

Additional Resources:

Chicago Tribune: Sen. Johnson Renews Call for More U.S. Oil Drilling