RSN: FOCUS: Oil Companies' Profits Soared to $174 Billion This Year as US Gas Prices Rose

 

 

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FOCUS: Oil Companies' Profits Soared to $174 Billion This Year as US Gas Prices Rose
Oliver Milman, Guardian UK
Milman writes: "The largest oil and gas companies made a combined $174 billion in profits in the first nine months of the year as gasoline prices climbed in the US, according to a new report."

Exxon, Chevron, Shell and BP among group of 24 who resisted calls to increase production but doled out shareholder dividends

The largest oil and gas companies made a combined $174bn in profits in the first nine months of the year as gasoline prices climbed in the US, according to a new report.

The bumper profit totals, provided exclusively to the Guardian, show that in the third quarter of 2021 alone, 24 top oil and gas companies made more than $74bn in net income. From January to September, the net income of the group, which includes Exxon, Chevron, Shell and BP, was $174bn.

Exxon alone posted a net income of $6.75bn in the third quarter, its highest profit since 2017, and has seen its revenue jump by 60% on the same period last year. The company credited the rising cost of oil for bolstering these profits, as did BP, which made $3.3bn in third-quarter profit. “Rising commodity prices certainly helped,” Bernard Looney, chief executive of BP, told investors at the latest earnings report.

Gasoline prices have hit a seven-year high in the US due to the rising cost of oil, with Americans now paying about $3.40 for a gallon of fuel compared with around $2.10 a year ago.

The Biden administration has warned the price hikes are hurting low-income people, even as it attempts to implement a climate agenda that would see America move away from fossil fuels, and has released 50m barrels of oil from the national strategic reserve to help dampen costs.

But oil and gas companies have shown little willingness so far to ramp up production to help reduce costs and the new report, by the government watchdog group Accountable.US, accuses them of “taking advantage of bloated prices, fleecing American families along the way” amid ongoing fallout from the Covid-19 pandemic.

“Americans looking for someone to blame for the pain they experience at the pump need look no further than the wealthy oil and gas company executives who choose to line their own pockets rather than lower gas prices with the billions of dollars in profit big oil rakes in month after month,” said Kyle Herrig, president of Accountable.US.

The analysis of major oil companies’ financials shows that 11 of the group gave payouts to shareholders worth more than $36.5bn collectively this year, while a dozen bought back $8bn-worth of stock. This apparent focus, rather than on further drilling, has caused some frustration within the federal government, with Jennifer Granholm, the US energy secretary, stating that “the oil and gas companies are not flipping the switch as quickly as the demand requires.”

A glut of new oil drilling has made the US awash with oil in recent years, turning the country into a top-level exporter as well as domestic supplier, but this has kept prices low to the displeasure of investors. “A lot of this has been driven by investor sentiment,” said Helima Croft, head of global commodity strategy at RBC Capital Markets, of the current reluctance to expand production. “They don’t want them to spoil the party.”

The situation has left the White House in an awkward position with its commitments to rapidly reduce planet-heating emissions, with environmentalists furious at administration attempts to expand drilling and fossil fuel companies also unhappy over some of its earlier climate-related moves, such as shutting down the controversial Keystone XL pipeline.

The oil and gas industry has fought Joe Biden’s attempts to pause new drilling permits on federal land, despite its unwillingness to expand operations in order to reap the returns of costlier oil and the fact the industry currently sits on 14m acres of already leased land that isn’t being used, an area about double the size of Massachusetts.

“It’s not the government that is banning them from drilling more,” Pavel Molchanov, an analyst at Raymond James, told CNN. “It’s pressure from their shareholders.”

Aside from its role in the current high gasoline prices, the oil and gas industry is a leading driver of the climate crisis, the reality of which it sought to conceal from the public for decades, and is a key instigator of the air pollution that kills nearly 9 million a year, a death toll three times that of the Covid-19 pandemic in 2020.

The American Petroleum Institute, a leading industry lobby group, pointed to a blog that blamed the Biden administration for policies that “significantly weaken the incentives to invest in America’s energy future” but did not answer questions on production rates of oil companies.

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POLITICO NIGHTLY: The Hopkins doc vs. the vaccine consensus

 

BY MYAH WARD Presented by Charter Communications With help from Tyler Weyant A child is held by relatives as he gets a Covid vaccine in Ferguson, Mo. | Spencer Platt/Getty Images VIRAL UNBOXING — It’s easy to put a person in a box, to write someone off as an anti-vaxxer. But it isn’t always that simple. Take Marty Makary, a professor of surgery and health policy at the Johns Hopkins University School of Medicine. He has made a name for himself during the pandemic, partly through his appearances on Fox News shows like Tucker Carlson’s. But while he’s certainly a contrarian pandemic pundit, he isn’t a fringe voice, nor a political one. He writes op-eds for places like The Washington Post and The New York Times. He told Nightly, unprompted, that he wasn’t a partisan, during an interview this morning. He had another piece published on the website for Fox News this morning, calling for new leadership at the FDA. He also told me I could call him any time if I wanted to hear a perspective on Covid policy that was different from the “standard party line.” Some on the left have said Makary is spreading misinformation, while some Republicans have accused him of being an alarmist. He’s argued against masks for children. He’s criticized the CDC for not conducting its own research on boosters. He’s pro-vaccine, but he opposes blanket vaccine mandates unless they’re for health care workers. Lately Makary has been questioning whether children, especially boys, need two doses of a Covid vaccine. Once again, he falls outside the consensus of his fellow public health experts with his views. Makary is particularly concerned about a condition known as myocarditis, inflammation of the heart, and its potential as a risk factor for young men after receiving the second dose of an mRNA vaccine. He’s proposed a one-dose regimen for young men, to lower their chances of developing the condition. So, no, Makary is not an anti-vaxxer, though you might be tempted to sort him into that box. But he also isn’t sold on the recommendation that a 12-year-old boy should be receiving two shots. “It may be that vaccines are a game changer for children, but that the dose is not quite perfected,” Makary told Nightly. The latest study out of Israel Makary points to, published last week in The New England Journal of Medicine, found the incidence of myocarditis was highest among males 16 to 29, with about 11 out of every 100,000 developing the condition after receiving the second dose. While the figure is higher than previous estimates, the risk is still small and the condition is usually mild and temporary. A CDC panel in May unanimously voted to recommend Pfizer’s vaccine for kids 12 to 15, saying the benefits outweigh the risks. CDC research has estimated that among every million fully vaccinated boys, ages 12 to 17, the shots might cause a maximum of 70 cases of myocarditis, but would prevent 5,700 infections, more than 215 hospitalizations and two deaths. Other studies have shown the risk of heart problems after getting Covid is higher than the risk after vaccination. The risk of myocarditis was among the reasons the FDA called for more children in vaccine trials this summer. The condition will likely be a hot topic during the agency’s Oct. 26 meeting about vaccines for children 5 to 11. Makary doesn’t disagree that myocarditis is rare, though he countered that the rate of severe disease or death in children is also rare. And the absence of a statistical breakdown of the roughly 650 childhood Covid deaths in the U.S. by comorbid condition doesn’t sit well with him. Makary wants the vaccine recommendations to factor in the nuances when it comes to kids. He questions whether a 13-year-old girl should receive the same dose regimen as a 55-year-old man. (Pfizer used a smaller dose of its Covid vaccine when conducting trials for children under 12.) He isn’t entirely alone in his thinking. Health officials in Hong Kong, Britain, Norway and other countries have recommended a single dose of the Pfizer-BioNTech vaccine for children 12 and older. Health officials in these countries have become increasingly worried about new data suggesting myocarditis may be more common among this group than they originally had thought. But other U.S. public health experts, like Mark R. Schleiss, a pediatric infectious disease doctor at the University of Minnesota Medical School, told Nightly today that the vaccine is still the lowest-risk option. Schleiss recommends getting your kids vaccinated with both doses as soon as you can. Follow the blanket recommendations. Protect your child before it’s too late. “I stand by what I have been saying for months: the best Covid vaccine to get is the one you can get RIGHT NOW (today!),” Schleiss said in an email to Nightly. “Definitely less myocarditis after just one dose of an mRNA vaccine. But ‘less’...relative term...SO RARE to begin with!” Welcome to POLITICO Nightly. Reach out with news, tips and ideas for us at nightly@politico.com. Or contact tonight’s author at mward@politico.com or on Twitter at @MyahWard. A message from Charter Communications: We’re proud to announce that Spectrum Internet ranks No. 1 in the U.S. News & World Report 2021-22 “Best Rural Internet Service Providers” rankings. This recognition underscores our ongoing commitment to connecting more communities from coast to coast, including rural areas. And we’re just getting started.   WHAT'D I MISS? — White House huddles with oil industry as gas prices climb: The White House has been consulting with the oil industry to seek a remedy for rising gasoline prices as surging inflation threatens to tarnish the economic recovery , according to three people familiar with the discussions. The latest outreach to the oil industry is an awkward shift for the Biden administration, which has pledged to move the country away from fossil fuels and has drawn criticism from the industry and Republicans for pausing lease sales of federal land for oil and gas development. — Rosen, former acting AG under Trump, appears before Jan. 6 committee: The acting attorney general during the final days of the Trump administration fielded questions from the Jan. 6 select committee today, according to two sources. Jeff Rosen, who led the Justice Department during former President Donald Trump’s chaotic last weeks in office, is the second known former top DOJ official to have a scheduled interview with the panel. His deputy took questions from House investigators last week. — Garland set to appear before House Judiciary next week: Attorney General Merrick Garland is scheduled to appear at the House Judiciary Committee next week, three sources familiar with the plans told POLITICO . The hearing on oversight of the Justice Department is set for Oct. 21. Garland’s first appearance before the committee may turn contentious. Panel Democrats have urged Garland to do more to combat Texas’s restrictive abortion law, including calling for DOJ to prosecute “would-be vigilantes.” They’ll also likely press Garland on voting rights, gun violence, immigration and the Jan. 6 attack on the Capitol. — Tim Scott rakes in $8.3M for reelection, possible 2024 bid: South Carolina Sen. Tim Scott took in nearly $8.3 million during the third fundraising quarter, a major sum that highlights the massive finance network Scott is building ahead of a prospective 2024 presidential bid. Scott has emerged as a fundraising powerhouse over the past year, winning over small- and large-dollar GOP donors alike. The senator, who is a heavy favorite to win reelection in 2022, raised nearly $20 million over the course of the year and got support from over 82,000 donors during the third quarter, according to a person familiar with the figures. — White House scrambles to address looming Christmas crisis: Biden is rushing to relieve congestion across the nation’s complex shipping supply chain as it threatens to disrupt the holiday season for millions of Americans. With just more than 10 weeks until Christmas, the White House is leaning heavily on port operators, transportation companies and labor unions to work around the clock unloading ships and hauling cargo to warehouses around the country. Biden met virtually today with industry leaders before delivering a speech on the administration’s efforts to address the bottlenecks. — NIH study: Moderna, Pfizer shots are most effective Covid boosters: Covid-19 booster shots from Moderna or Pfizer showed signs they are more effective at protecting vaccinated adults than a second dose of Johnson & Johnson’s vaccine , according to preliminary results from a government-funded study. All of the participants in the National Institutes of Health study saw an antibody boost after receiving additional doses of the three vaccines. But people who originally received J&J benefited significantly more from a messenger RNA booster than from a second J&J dose, according to the study. The increase in binding antibodies — one signal of an immune response — was greatest for those who initially were immunized with J&J’s shot but received one of the mRNA boosters.   THE MILKEN INSTITUTE GLOBAL CONFERENCE 2021 IS HERE: POLITICO is excited to partner with the Milken Institute to produce a special edition "Global Insider” newsletter featuring exclusive coverage and insights from one of the largest and most influential gatherings of experts reinventing finance, health, technology, philanthropy, industry and media. Don’t miss a thing from the 24th annual Milken Institute Global Conference in Los Angeles, from Oct. 17 to 20. Can't make it? We've got you covered. Planning to attend? Enhance your #MIGlobal experience and subscribe today.     AROUND THE WORLD FAREWELL EUROPE’S CENTER-RIGHT? In an unlucky span of 13 days, Europe’s predominant political family — the European People’s Party — saw its most seasoned leader, Angela Merkel, walk into the sunset and its brightest new star, Sebastian Kurz of Austria, crash to Earth, David M. Herszenhorn and Maïa de la Baume write. With Merkel not running for another term, her Christian Democratic Union fell to a defeat in the Sept. 26 federal election — the latest in a string of setbacks — that means the European alliance of center-right and conservative parties will almost certainly soon lose control of its biggest prize, the German government. The party of EU founding fathers such as Schuman, De Gasperi and Adenauer — and more recently of Berlusconi, Sarkozy and Van Rompuy — has now entered what some party leaders are calling its worst spell in the political desert that any of them can remember. The EPP, which has dominated EU politics for decades, remains the largest faction in the European Parliament and Ursula von der Leyen, a disciple of Merkel’s, still holds the European Commission presidency. But the EPP currently claims just nine of the 27 seats for heads of state and government around the European Council table. Perhaps even more shockingly, if a new Social Democrat-led government forms in Berlin, as is widely expected, the westernmost European capital with a conservative leader will be Ljubljana. PUTIN TO EUROPE: ALL GAS, NO BREAKS — Russian President Vladimir Putin today promised that his country is ready to boost natural gas shipments to Europe at a time when the Continent is battling the political and economic impacts of soaring energy prices, Jan Cienski and Aitor Hernandez Morales write. Russia is the largest gas supplier to the EU, and Putin insisted it was “flawlessly” fulfilling its contracts with European customers, adding, “we are ready to ... even increase” sales. “We will increase by as much as our partners ask us. There is no refusal, none,” he said. Although Russia hasn’t broken any contracts, its European storage facilities have less gas than usual, contributing to market turmoil. Putin’s comments at the Russia Energy Week Conference in Moscow came on the same day that the European Commission came out with a series of measures aimed at calming member countries’ outrage over soaring gas and power prices.       NIGHTLY NUMBER 3,000 mg per day The voluntary sodium limits, reduced from 3,400 mg per day, for more than 160 categories of processed foods the FDA released today, long-delayed reduction targets for food makers to voluntarily cut back their use of salt.   “A FOREIGN POLICY BUILT FOR WOMEN” – JOIN US THURSDAY FOR A WOMEN RULE CONVERSATION: Building a foreign policy agenda with women at the center has shown that it can advance broader social, economic and political goals. It also requires having women in influential decision-making positions. Join POLITICO Magazine senior editor Usha Sahay for a joint conversation with Ambassador Gina Abercrombie-Winstanley, the State Department’s chief diversity and inclusion officer, and Ambassador Bonnie Denise Jenkins, undersecretary for arms control and international security, focused on the roadblocks preventing more women from rising through the ranks of diplomacy and why closing the foreign policy gender gap matters. REGISTER HERE.     PARTING WORDS Kyrie Irving of the Brooklyn Nets during a preseason game against the Los Angeles Lakers at Staples Center in Los Angeles. | Kevork Djansezian/Getty Images PLAYING HARDBALL — Nightly’s Tyler Weyant writes: Fans who watch NBA games when the regular season starts next week won’t see one of the league’s superstars: Kyrie Irving, who is on the bench for the Brooklyn Nets until he complies with the New York vaccine mandate for indoor gyms. Irving is not the first celebrity to make headlines for an anti-vaccine stance. So, like we did when Nicki Minaj’s tweets caused a swell of reactions , we reached out to Melanie Kornides, an epidemiologist at the University of Pennsylvania School of Nursing who has done research on influencers and vaccine misinformation. Kornides noted that Irving is famous not just for refusing vaccination and for playing basketball, though he is the 7th most popular NBA player right now, according to a recent YouGov America poll. He’s also made headlines for charitable donations to food banks and HBCU students. (And, Nightly must add, for apologizing to science teachers for saying the Earth is flat.) “Check out his tweet from October 9: ‘I am protected by God and so are my people. We stand together.’ He aligns himself with this religious perspective,” Kornides said in an email. It is hard to determine how much impact Irving’s actions may have, Kornides said. “Ideally, we would like to have pro-vaccine influencers to counteract voices like Nicki’s and Kyrie’s that are trusted by different groups of people,” she said. “One person may not be able to influence everyone. The most important thing is that the influencer needs to be separate from the political process.” A message from Charter Communications: Access for all means opportunity for everyone. That’s why we’re investing billions to extend our network to reach those who need it most. Over the next several years, Charter will build more than 100,000 miles of new U.S. broadband infrastructure that will deliver reliable, high-speed internet access to even more communities from coast to coast. That’s an extension long enough to circle the equator four times. 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