January, 2005

You gotta hand it to Chevron-Texaco and “trust the man who wears the star” to jump right in there when times are tough, the country is at war and a quick profit can be turned. War-profiteering is probably a little strong and pointing at Chevron-Texaco before their competitors post quarterly results a tad misleading, but it’s fun sometimes to mislead about those oil giants. Counterbalances those two-page spreads they buy to convince us they’re actually eco-friendly.

Seems with the airlines going broke one-after-the-other and small independent truckers having a hard time making the mortgage (not to mention the truck) payments, oil companies would be hurting just a bit. Not so. Chevron-Texaco’s profits doubled in the 4th quarter. And this, in spite of production falling nearly 9% because of hurricane damage at their southern refineries. Like my old daddy said, “the rich get rich and the poor get children.”

Stock analysts said the quarterly results showed “a good set of numbers.” Well, I guess. Probably, in the likelihood of W going to go to war with Iran, a smart fella would load up on Chevron-Texaco stock. The more this administration does to screw up OPEC producers, the higher those quarterly profits are likely to go.

In more rational times, we paid taxes to support the costs of the wars we fought and excessive profits that stemmed from those wars were looked down upon as not exactly patriotic. But these are different times, when Wall Street calls a refiner’s quarterly $3.44 billion jump in profits a good set of numbers.

Refiners take that sticky “crude” oil that comes from various wells around the globe and refine it into various grades of usable stuff, from kerosene to fuel oil for your house to gasoline and diesel fuel. That’s why they call them refiners (it isn’t because of their season tickets to the opera).

So, let me ask you if this makes sense . . . any kind of sense, economic or moral? Residual fuel oil went up (about) 15% in the last year, motor gasoline and diesel 24% and jet fuel 63%. But crude oil was up 54% as a cost at refineries. Yet Chevron-Texaco made an extra three thousand, four hundred forty million dollars in three months. How do they do that? Is David Copperfield involved?

Meanwhile, the airlines’ are going broke, kicking their unions in the butts, trashing their pension funds and blaming the whole mess on fuel costs. It’s the Wizard, behind that curtain again and the Tin Man has no heart.

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