Big Oil's big 'problem'

[moshquerade]

Anyone want to try to defend this?

Big Oil's big 'problem'

US giants Conoco and Exxon have more money these days than they know what to do with, so they're handing it out to shareholders. What they aren't doing with it is much that will reduce the oil crunch, says MSN Money columnist Michael Brush.

http://articles.moneycentral.m...?cp-documentid=7569804


full article:
http://articles.moneycentral.m...BigOilsBigProblem.aspx

 

[Savij]

Originally posted by: moshquerade

Anyone want to try to defend this?

Big Oil's big 'problem'

US giants Conoco and Exxon have more money these days than they know what to do with, so they're handing it out to shareholders. What they aren't doing with it is much that will reduce the oil crunch, says MSN Money columnist Michael Brush.

http://articles.moneycentral.m...?cp-documentid=7569804


full article:
http://articles.moneycentral.m...BigOilsBigProblem.aspx

They should be paying us to not live 100miles from work?

 

[yllus]

What's to defend? More than one analyst agrees that oil is becoming more and more cost-prohibitive to go after, so Big Oil is spending more money on buying back its own stock to shore up its value than it spends on reserve exploration. They're doing what they're supposed to be doing: Acting in the best interests of their stockholders.

 

[DisgruntledVirus]

When they make how ever many billions in PROFIT they made last year I realized that they weren't going to reduce the price anytime soon without government regulations.

 

[sygyzy]

Are you asking people to defend Big Oil or the article?

 

[moshquerade]

Originally posted by: yllus
What's to defend? More than one analyst agrees that oil is becoming more and more cost-prohibitive to go after, so Big Oil is spending more money on buying back its own stock to shore up its value than it spends on reserve exploration. They're doing what they're supposed to be doing: Acting in the best interests of their stockholders.

Sure, as a stockholder for Big Oil I am jumping for joy, but weren't they supposed to be investing some of the money in ways that would help contain the daily rise in gasoline prices at least a little? Isn't that their argument when they are faced with tough questions about their glut of profit?

 

[moshquerade]

Originally posted by: sygyzy
Are you asking people to defend Big Oil or the article?

defend Big Oil.

 

[maddogchen]

buy oil stocks to reap the dividends?

 

[Queasy]

Well, when we won't let oil companies explore off the Florida coast, off the west coast, off the east coast, ANWR, oil shale, etc....they're options on oil exploration are probably pretty limited.

 

[nakedfrog]

Yeah, I'd think they'd be best served by spending as much money as they can on researching alternatives, because they know they can't rely on selling oil forever.

 

[JS80]

Originally posted by: moshquerade

Originally posted by: sygyzy
Are you asking people to defend Big Oil or the article?

defend Big Oil.

It's only an illusion that they appear to be making a lot of money. Their profit margin still runs only at 10% (vs Google at 25% and Apple at 15%). The reason why they appear like they are making so much is that they are conglomerates. If they were 50 separate small entities vs 1 HUGE entity they wouldn't have this PR problem.

 

[rudder]

Big oil sells gas for $4/gallon. U.S. public cries but does not change habits or consumption levels. Big oil continues to profit. They found out after Katrina hit that America was ready for higher gas prices. Now they are just searching for that sweet spot where the price gives them a nice profit... but not so expensive that Americans cut back.

 

[maddogchen]

what i think is that we should tax oil companies. Use that tax to fund development and research of alternative energy. Taxing oil companies will drive the price of gas up and put our economy in the toilet. But in the long run I think we can achieve a solution to alternative energy faster. We cannot rely on oil companies to do research at their own pace for alternative energy.

Of course this is just my opinion.

 

[So]

Originally posted by: moshquerade

Originally posted by: yllus
What's to defend? More than one analyst agrees that oil is becoming more and more cost-prohibitive to go after, so Big Oil is spending more money on buying back its own stock to shore up its value than it spends on reserve exploration. They're doing what they're supposed to be doing: Acting in the best interests of their stockholders.

Sure, as a stockholder for Big Oil I am jumping for joy, but weren't they supposed to be investing some of the money in ways that would help contain the daily rise in gasoline prices at least a little? Isn't that their argument when they are faced with tough questions about their glut of profit?

No, they are not. They are supposed to invest their money in a way that makes their share price increase and profits the shareholders the most. They have no legal responsibility to the market at large, and morally, they don't owe anything to us. We choose to pay the high oil prices, they get to choose what to do with the profits. It's a free country, well, it used to be at least.

 

[lokiju]

Dear Lord,

Please make the news articles, threads and person to person nonstop discussion of global warming and gas/oil stop or at least slow to a trickle.

For mine and everyone's sanity.

Thank you Lord,
Amen

 

[waggy]

well to be fair they are doing exactly what any business does. Make as much money as they possibly can. they are not a charity.

Originally posted by: nakedfrog
Yeah, I'd think they'd be best served by spending as much money as they can on researching alternatives, because they know they can't rely on selling oil forever.

yeap. i have a feeling they are going to screw themselves. MORE money is being pumped into a alternatives fuel source that when if found is going to serverly hurt big oil companys. they are not looking long term and just looking at how they can get as much as they can now.

 

[moshquerade]

Originally posted by: rudder
Big oil sells gas for $4/gallon. U.S. public cries but does not change habits or consumption levels. Big oil continues to profit. They found out after Katrina hit that America was ready for higher gas prices. Now they are just searching for that sweet spot where the price gives them a nice profit... but not so expensive that Americans cut back.

U.S. public is changing their habits. I went used car shopping with a friend recently. He is looking for a smaller car that gets better gas mileage. They aren't that easy to come by as people here scoop up the good deals on them as soon as they hit the lot. but plenty of salespeople told us that they have a lot of used SUVs and trucks that are a real bargain as people have been rushing to dump them. one salesperson told us they cringe when someone in an SUV comes onto their lot.

as far as gas consumption, i can definitely say i have been more conscious of saving gas and car pooling.

 

[moshquerade]

Originally posted by: lokiju
Dear Lord,

Please make the news articles, threads and person to person nonstop discussion of global warming and gas/oil stop or at least slow to a trickle.

For mine and everyone's sanity.

Thanks you Lord,
Amen

nice prayer.

now let me give you your blankey, tuck you in, and wish you sweet dreams.

 

[lokiju]

Originally posted by: moshquerade

Originally posted by: lokiju
Dear Lord,

Please make the news articles, threads and person to person nonstop discussion of global warming and gas/oil stop or at least slow to a trickle.

For mine and everyone's sanity.

Thank you Lord,
Amen

nice prayer.

now let me give you your blankey, tuck you in, and wish you sweet dreams.

:heart:

 

[ElFenix]

Originally posted by: moshquerade
Sure, as a stockholder for Big Oil I am jumping for joy, but weren't they supposed to be investing some of the money in ways that would help contain the daily rise in gasoline prices at least a little? Isn't that their argument when they are faced with tough questions about their glut of profit?

if a company cannot invest profits better than shareholders can then the company should return the money to shareholders. (actually not quite that simple, has to do with cost of capital, but whatever)

 

[CycloWizard]

I'll defend them. They are a company. As such, their one and only goal is to maximize profits. They are doing exactly that. You are trying to inject morality into capitalism. Why would oil companies spend money in order to decrease their own profits? They will lose money if they increase production rates, yet this is what you think they should do.

 

[Chunkee]

THey should just sell oil flavored Pringles

 

[PepePeru]

Originally posted by: CycloWizard
I'll defend them. They are a company. As such, their one and only goal is to maximize profits. They are doing exactly that. You are trying to inject morality into capitalism. Why would oil companies spend money in order to decrease their own profits? They will lose money if they increase production rates, yet this is what you think they should do.

okay playing Devils Advocate here...

Menu Foods was just trying to maximize profits when they sold tainted dog food.
Who cares if it killed some peoples dogs....youre trying to inject morality and compassion for pets into the bottom line. They will lose money if they have thorough quality control for all the pet food that leaves their factories., yet this is what you think they should do. They answer to their stockholders and no one else.

 

[waggy]

Originally posted by: G Wizard

Originally posted by: CycloWizard
I'll defend them. They are a company. As such, their one and only goal is to maximize profits. They are doing exactly that. You are trying to inject morality into capitalism. Why would oil companies spend money in order to decrease their own profits? They will lose money if they increase production rates, yet this is what you think they should do.

okay playing Devils Advocate here...

Menu Foods was just trying to maximize profits when they sold tainted dog food.
Who cares if it killed some peoples dogs....youre trying to inject morality and compassion for pets into the bottom line. They will lose money if they have thorough quality control for all the pet food that leaves their factories., yet this is what you think they should do. They answer to their stockholders and no one else.

there is a diffrence between having a product that damages property (animals are considered property) and makeing as much as you can.

really its a stupid argument.

 

[maddogchen]

Originally posted by: G Wizard

Originally posted by: CycloWizard
I'll defend them. They are a company. As such, their one and only goal is to maximize profits. They are doing exactly that. You are trying to inject morality into capitalism. Why would oil companies spend money in order to decrease their own profits? They will lose money if they increase production rates, yet this is what you think they should do.

okay playing Devils Advocate here...

Menu Foods was just trying to maximize profits when they sold tainted dog food.
Who cares if it killed some peoples dogs....youre trying to inject morality and compassion for pets into the bottom line. They will lose money if they have thorough quality control for all the pet food that leaves their factories., yet this is what you think they should do. They answer to their stockholders and no one else.

wouldn't you eventually lose customers once word got out that you sold tainted dog food? your reputation also goes down the toilet. That means your stockholders sell and your stock plummets.