Billions in profits not enough.

[ranwin33]

U.S. Has Royalty Plan to Give Windfall to Oil Companies
By EDMUND L. ANDREWS

WASHINGTON, Feb. 13 "” The federal government is on the verge of one of the biggest giveaways of oil and gas in American history, worth an estimated $7 billion over five years.

New projections, buried in the Interior Department's just-published budget plan, anticipate that the government will let companies pump about $65 billion worth of oil and natural gas from federal territory over the next five years without paying any royalties to the government.

Based on the administration figures, the government will give up more than $7 billion in payments between now and 2011. The companies are expected to get the largess, known as royalty relief, even though the administration assumes that oil prices will remain above $50 a barrel throughout that period.

http://www.nytimes.com/2006/02/14/business/14oil.html?_r=1&incamp=article_popular

[Aught Six]

"We need to remember the primary reason that incentives are given," said Johnnie M. Burton, director of the federal Minerals Management Service. "It's not to make more money, necessarily. It's to make more oil, more gas, because production of fuel for our nation is essential to our economy and essential to our people."

Getting more oil faster is a good thing. A shortage is the last thing we need--costs are high enough as it is.

Also remember that with record profits come record taxes. The government isn't exactly bleeding itself here. And with a socialist windfall profits tax on the horizon, oil companies need all the help they can get.

[Charlie P]

And with a socialist windfall profits tax on the horizon, oil companies need all the help they can get.

Lol, Is that why they want the tax payers to pay for their Research and Develpment?

[Lanse couche couche]

Kuwait should be selling us oil at about 20 per barrel after we saved their rich tails from Iraq. We should also be getting oil from Iraq at cut-rate prices to help pay for their liberation.

[Aught Six]

Lol, Is that why they want the tax payers to pay for their Research and Develpment?

Probably not. I think the American petroleum industry is simply looking for help speeding things up. It's important to remember that all industries seek government grants. What matters most is the payoff in the long run.

[ranwin33]

I always heard there isn't an oil shortage, there is a refining shortage.

And it was just reported refining companies are looking to cut output to keep gasoline prices high.

So with $10 billion in quarterly profits by ONE oil company, they need what amounts to another $65 billion government handout to find more oil?

[Aught Six]

Kuwait should be selling us oil at about 20 per barrel after we saved their rich tails from Iraq. We should also be getting oil from Iraq at cut-rate prices to help pay for their liberation.

Oil is a globally traded commodity. Individual countries don't set prices of the free market.

[Deleted User]

[Deleted by Admins]

[Aught Six]

I always heard there isn't an oil shortage, there is a refining shortage.

Little of both. Here in the U.S. refining capacity is pretty lousy, butexploding comsumptionin China and India isn't help anything either.

And it was just reported refining companies are looking to cut output to keep gasoline prices high.

That's ridiculous. Even if they cut production and inflated prices, they still wouldn't make as much money as selling more for cheaper. When supply drops and prices increase, consumption takes a dive, leading to fewer sales.

So with $10 billion in quarterly profits by ONE oil company, they need what amounts to another $65 billion government handout to find more oil?

You know, those $10 billion aren't exactly being shoveled into some executive's bankvault. That money goes to investors,overhead, expansion, R&D, etc. It costs a lot of money to grow a business.

When it all boils down, there is simply a widespread sentiment of disgust towards wealth. I suppose envy is the primary cause.

However, I see no reason to punish those who work hard and become successful. I don't get my paycheck from somesenator on Capitol Hill--I get it from a red-blooded American companythat expects to make gains in exchange for the work it produces.

Instead of whining about the money other people have, I prefer to buckle down and work hard.If I spent all my time complaining, I wouldn't have time to build any wealth for myself.

[Lanse couche couche]

The "debt" that Kuwait and Iraq owe us is aseparate issue from free market issues.