Oil companies already drill — and spill — on some of America’s most sensitive wild lands. Do they really need taxpayer money to do it?
Most of the American public doesn’t think so — according to a recent NBC News/Wall Street Journal poll, nearly three fourths of Americans support ending subsidies for oil companies.
Lately, it seemed as if some in Washington may actually be listening. In his weekly address last Saturday, President Obama called for an end to oil subsidies, and even House Speaker John Boehner admitted that oil companies should pay their way.
Yet despite these calls for action, and the support of the majority of Americans, a vote to end billions in subsidies to major oil companies failed late Tuesday in the Senate. While the measure won the support of a bipartisan majority, the bill fell eight votes short of the required 60 needed.
The facts make it clear that oil companies don’t need taxpayer money. Many of these companies are celebrating record profits. In the first quarter of 2011, Exxon Mobil earned more than $10 billion, followed closely by Shell with nearly $9 billion. BP, scarcely a year after being partly responsible for the worst oil spill disaster in U.S. history, made more than $7 billion in earnings.
According to the federal government's Energy Information Administration, the average cost to produce a barrel of oil in the United States is approximately $30—yet with the current market, a barrel of oil costs around $100. This means that oil companies pocket about $70 for every barrel sold, passing the costs on to the consumer.
All this from an industry that spends millions to fight safety inspections and environmental laws that keep our water clean, air pure and wild places unspoiled.
This week, the Senate missed a chance to cut through the oil industry’s empty threats and vote to end billions in costly and unnecessary subsidies. Yet the White House and Senate leadership have vowed to try again, keeping up the pressure on oil companies and their friends in Congress.
In the coming months, we will continue our work to get the oil industry out of Americans’ wallets. Ending oil subsidies will be an important first step toward an energy policy that embraces greater energy efficiency and alternative power sources beyond the environmentally-destructive status quo.