The big oil companies announced very, very big profits last week as gas prices surged above $5 per gallon in some parts of the nation. Best of all for Republicans, Americans were blaming Barack Obama for their pain at the pump, and the President's approval ratings were slipping.
Exxon enjoyed a 69% jump in first quarter profits over the same period last year, taking home $10.7 billion. Conoco Phillips' coffers jumped 43% as they stuffed another $3 billion into their kitty, and Chevron found they'd cleared $6.2 billion, up 36% from Q1 2010.
Royal Dutch Shell reported they'd managed to clear $6.3 billion in the first quarter, a 30% improvement over the first quarter last year. BP was the only one of the "Big Five" whose profits slipped this year, dipping to a measly $5.48 billion compared to $5.6 billion for the first quarter last year. BP incurred certain charges while it was busy mopping up some spillage over the summer.
While most folks would be happy with the billions, the oil moguls must have been even happier that their $5 per gallon gas attack was hurting one American even more than the rest. President Obama's popularity was down, especially among the 39% of Americans who said gas prices were hurting them. Only a third of them approved of Obama.
While analysts have blamed Middle East unrest, Chinese demand, and speculating speculators for high oil prices, actual global demand has flattened. The catastrophic earthquake, tsunami and meltdown tragedies in Japan, the world's third largest economy, have quelled some of the thirst for oil.
Some had been predicting $5 gas since before the current round of Mid-East turmoil. Former Shell Oil exec John Hofmeister said $5 gas was around the corner back in December, before anyone knew flying into Tripoli International was going to become a bit dodgy for anybody not riding a French Rafale fighter.
The big jump in pump prices has hurt the nascent economic recovery, although Wall Street shrugged off the anemic 1.8% first quarter growth in GDP. Perhaps a sniff of Obama's lower approval scores helped ease their pain over weaker than expected growth.
Senate Minority Leader Mitch McConnell (R-KY) had pledged that defeating Barak Obama in 2012 was the Republican Party's number one goal. For McConnell and the Republicans, creating jobs, growing the economy, and providing health care all took a back seat to destroying the Obama Presidency. The oil industry poured millions into Republican campaigns, the Independent Petroleum Association of America alone kicking $19 mil into GOP election coffers. The American Petroleum Institute, whose members include Exxon and Chevron, gave $27 million to mostly Republican campaigns. For that kind of largess, one would hope the oil companies at least approved of McConnell and the Republicans' agenda, let alone had a hand in formulating that agenda.
McConnell and his GOP legions went to Capitol Hill to wreck the Obama Presidency, and the oil companies were among the folks who sent them there to do so. Aside from sending others to do your bidding, if you could help your own cause simply by pumping up pump prices to grind down the economic recovery and bludgeon the President's approval rating while raking in a few extra billion to boot, why wouldn't you? If it wasn't part of the vast right-wing conspiracy's plot to destroy the world, it certainly should have been.
Analysts blaming speculators for rising oil prices doesn't preclude those speculators including industry insiders, and Republican contributors.
The President has long been calling for an end to oil company subsidies, which run to $4 billion a year. House Speaker John Boehner (R-OH) and Budget Committee Chair Paul Ryan began making noises that ending subsidies might be an acceptable idea until Luca Brasi swung by with a horse's head wrapped in a blanket. $4 billion might begin approaching chump change status when it's spread out across an industry in which one company clears $10 billion in a quarter, but it turns out nobody wants to give up an extra four billion dollar bills to stuff into strippers' g-strings, after all.
Even if all this turns out to be a happy happenstance for GOP-backing oil moguls and their industry minions, it is certainly a de facto assault on the Obama presidency, with the American people as unfortunate collateral damage in the war to toss Democrats out of the White House. Intentional or not, the effect is precisely the same: pain at the pump, and more pain down the road when a faltering economic recovery falters completely.