World's oil companies profit from the rise in oil prices

October 31, 2008

The World’s largest oil companies are raking in huge profits owing to the rise in oil prices. Their windfall gain has come at a time when even their production has come down. While Royal Dutch Shell recorded a third quarter profit of $10.9 billion up 71 percent, Exxon Mobil broke its own record for the biggest quarterly profits in the US by earning $14.8 billion up 58 percent, despite an 8 percent decline in production. BP recently declared a profit growth of 148 percent which prompted Gordon Brown into stating that a reduction of oil prices in oil pumps was needed after the reduction of oil prices globally.
Such profits prompt the public to call for the creation of windfall tax that applies a tax on the huge profits companies make in inflated markets. The companies claim however that all their profits get invested back into their businesses and that their huge profits also imply that they have to pay very large taxes on their income hence a windfall tax in unnecessary.
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