Gas pumps

There is something wrong with gas prices, when the experts predict that gas prices could reach $5.00 by the end of the summer. This does not make sense, because the five big oil companies are making record profits. The five big oil companies are BP, Chevron, Conoco-Philip, Exxon-Mobile, and Shell.

President Obama stated, “Over the past 5 years the least the five big oil companies made a year was $75 billion and the most was $125 billion.” He also added, “It’s gotta stop. Instead of subsidizing yesterday’s energy’s source, let’s invest in tomorrow’s.” Since 2005 to 2009, the big oil companies have made over $485 billion in profits combined.

In the last two months, every time you go to the gas station to put gas in your car, you wonder how high the price has gone up. Everyone knows without gas in their car, you can not go from point A to point B, so you pay the price. The five large oil companies control our check books, but we wonder, “When will it stop or slow down?”

This week on the President’s weekly radio program, he addressed the higher gas prices, and suggested some solutions to lower the big oil companies’ record profits. He started his conversation by telling Americans that there is no “magic bullet” to immediately bring the prices down. In all probability, the prices will increase this summer and everyone will have to dig a little deeper.

Nevertheless, he wants to end what he called $4 billion in taxpayer subsidies to oil and gas companies. The taxpayers spend billions of dollars each year paying for tax loopholes for big oil companies. Cutting the subsidies to big oil companies would help our economy while shirking the federal budget deficit.

On the other hand, the large oil companies executives want the subsidies to continue because they assume the legal risk for exploration and extraction of fossil fuels. Even though the petroleum industry has the largest tax incentives than any other industry in the country, it feels that it should not pay more taxes.

Our entire transportation system is built on petroleum products; therefore research, construction cost, and capital investments loans have low interest rates, tax-free rates, or no cost at all. Income tax breaks feature antiquated and obscure tax laws, which make for very lenient accounting. Sales tax breaks on petroleum products are lower than average sales tax rates for other goods.

President ObamaBasically, the big oil companies are making hundreds of billions in profits, and President Obama has put together a fraud team to analyze why the price of gas has escalated so quickly. According to the president the fraud team will “root out any cases of fraud or manipulation in the oil markets that might affect gas prices, and that includes the role of traders and speculators. We are going to make sure that nobody’s taking advantage of American consumer for their own short-term gains.”

It is excellent that the president has initiated a fraud team, but there appears to be a fundamental problem with the laws and the system as it relates to the big oil companies. There is something wrong when there are five major companies that continue to make hundreds of billions in profit and the citizens cannot feed their families. There is also something wrong when the government gives these companies tax breaks and subsidies, and they do not have to open their books to government regulators.

In the final analysis, the gasoline price gougers are the five major companies that keep making more profits each year, and their greed is approved by the government and the legal system. The president is correct when he calls for an end to subsidies to oil and gas companies, and he should also force them to open up their books.