NEW YORK -- Exxon Mobil Corp. made almost $11 billion and practically apologized for it.
Sensing public outrage over gasoline prices that have topped $4 in some states, the Irving-based energy giant struck a defensive posture Thursday after posting one of its best quarterly profits ever.Exxon said it had no control over high oil prices. It said it's one of the biggest taxpayers in the United States. It cast federal subsidies as "legitimate tax provisions" that keep jobs at home, and cast itself as a victim of Washington scapegoating."They feel they have to demonize our industry," said Ken Cohen, Exxon's vice president for public affairs. What's more, the company argued, it doesn't even make that much money selling gasoline.Exxon's profit of $10.65 billion in the first quarter was its highest since it made $14.83 billion in the third quarter of 2008, a record for a publicly traded company. That was also a time of $4-plus gas and record crude oil prices.The first-quarter results were also the best among the big oil companies, which have reported improved results this week.As oil company profits approach levels of three years ago, the industry is fighting a renewed push from President Barack Obama and Democrats to end $4 billion a year in tax subsidies. Before it even came out with the quarterly results, Exxon pleaded its case on a company blog, saying it was not to blame for high gas prices.Then Cohen took an unusual step and spoke to reporters after Exxon reported the big profits. He said Exxon pays more taxes than any other company in the Standard & Poor's 500 index -- $59 billion in the United States over the past five years.After taxes, the company earned $41 billion from U.S. operations during that period.Exxon noted that only 6 percent of its profit came from refining and selling gas in the United States. Other parts of its business, like selling oil and natural gas overseas, accounted for much more.Argus Research analyst Phil Weiss finds that argument reasonable. But oil companies will struggle to win over people as long as they're making billions of dollars every quarter, he said.House Democratic leader Nancy Pelosi called for a vote on ending taxpayer subsidies to oil companies next week. "There is no reason American taxpayers should subsidize Big Oil's profits," Pelosi said.The tax provisions at issue include some rules put in place as long ago as 1913 and more recent ones designed to encourage companies to invest in the United States.For instance, a 2004 rule that gives oil and other companies a special deduction for their U.S. operations could save the oil industry $18.2 billion over 10 years.A rule that allows faster depreciation of the value of oil and gas wells could save independent companies -- those that only explore and produce oil but don't refine it -- about $11 billon over a decade.Environmental groups say the industry needs no taxpayer help."Why does an industry that makes this much money need $4 billion in tax subsidies?" asked Bob Keefe, spokesman for the Natural Resources Defense Council. "Why can't we use that tax money to improve and expand other alternatives, increase vehicle efficiency, better public transportation that would reduce our dependence on oil?"The company has increasingly focused on producing natural gas, which it expects to replace coal as the second most important fuel source after petroleum within the next decade. Last year it acquired Fort Worth-based XTO Energy to become the largest U.S. natural gas producer.Have more to add? News tip? Tell us
