Making money is supposed to be a foundation of American capitalism, and it's crucial to keeping investors happy. But U.S. oil companies are finding that record profits haven't helped their image, not with consumers angry about higher gas prices and politicians searching for short-term cures.
Oil businesses are trying to explain why their profits aren't a bad thing. The price of mangling that message could be steep: Some in Congress are discussing added regulations as well as a windfall profits tax that the industry fears could send it into a skid.
"It's a no-win situation," said Fadel Gheit, a stock analyst who follows the energy industry for New York-based Oppenheimer & Co. "Nobody wants to be in the public eye accused of price gouging."
Criticism has washed over the industry recently.
Last week, the Consumer Federation of America issued a report accusing oil companies of pocketing $100 billion of "excess profits" from 2000 to 2005. Sen. John McCain, an Arizona Republican, recently cited oil company profits and suggested the industry's public relations sense was worse only than that of satanic cults, according to press accounts.
The Chicago Tribune reported that the head of public relations for the Chrysler Group - part of the automaking industry that has had symbiotic ties with big oil - wrote in a company blog that the oil industry has "a history of blowing their exorbitant profits on outlandish executive salaries and stock buybacks, and hoarding their bounty rather than lowering fuel costs."
And in a recent Fox News poll, 66 percent of voters blamed the oil industry "a lot" for high gas prices.
The biggest oil company, Exxon Mobil Corp., pulled in a record $8.4 billion in the first three months of this year, after $36.1 billion in profit for 2005 - a record for a U.S. company. Chevron's first-quarter profit leaped to $4 billion - 49 percent more than the same period a year earlier. And No. 3 ConocoPhillips reported $3.29 billion as revenue rose 23 percent.
Some of that profit is related to a steep rise in crude oil prices, which has benefited U.S. petroleum companies with oil holdings. Some analysts attribute most of that rise to factors oil companies do not control: increased global demand, reduced production in some nations and nervousness about tensions with Iran.
