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Apr 2, 2008 8:07 am US/Central
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In The Know: Approval Ratings Below Politicos'
(WCCO)
The big five oil companies appeared before Congress Tuesday. Politicians are upset about high gasoline prices at the pump, and questioned big oil's big profits. Don Shelby says Congress has no control over the rising cost of petroleum.
The price we pay for a barrel of oil isn't set by Congress, and it isn't set by the oil companies. It is set by a global market and global demand.
The U.S. isn't the only player in that game. China and India will account for 60 percent of world's oil demand in a few years.
Now, the oilmen told Congress a lot of the profits are spent on exploration and drilling to find new sources of oil for the world's unquenchable thirst.
Some members of Congress wanted to scrap any tax breaks on exploration given to oil companies. Exxon testified its effective tax rate is 44 percent, compared to 30 percent for other large corporations.
Congress is posturing for its electorate, but unless it can find a way to increase the value of the dollar, or find more oil, it has little power.
The truest statement made today came from Rep. John Hall of New York. He told the oil barons the hard truth. He said, "Your approval ratings are below ours."
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