Oil Industry

On the evening of Feb. 2, 1942, an unarmed tanker with 66,000 barrels of crude oil on board was steaming in the Atlantic, about 90 miles off Ocean City . Without warning, it was struck by German torpedoes. The attack set the W.L. Steed ablaze, and sank it; only a handful of the crew of 38 survived. As World War II unfolded, the Germans had moved part of their sub pack west to attack shipping along the coast. By the time the Nazis withdrew the subs in July to focus on convoys crossing the North Atlantic, they had sunk 397 ships in U.S. coastal waters.

WASHINGTON -- Breaking with other oil industry leaders, a senior British Petroleum executive has acknowledged that scientists have reached a consensus about global warming and that to ignore concerns over climate change "would be unwise and potentially dangerous."John Browne, group chief executive of the British oil company, said that in tackling the controversial issue of global warming, about which the oil industry has long expressed skepticism, it is time "for change and for a rethinking of corporate responsibility."

A Hanover-based maker of components for power transmissions, oil rigs and steel mills said Monday it will shut its manufacturing operation in the next 12 months to 15 months and lay off 125 hourly and salaried workers. Kop-Flex Inc., a division of St. Louis-based Emerson Electric Co., will phase out manufacturing at the Anne Arundel County location on Harmans Road, a decision based on "global economic and competitive pressures," Dave Baldridge, an Emerson spokesman, said Monday.

Gulf oil coated state politics last week as Democrats in Maryland's two highest-profile contests tried to tar their likely Republican opponents with the BP spill. Maryland Republicans responded with indignation: Former Gov. Robert L. Ehrlich Jr. accused Gov. Martin O'Malley of "seeking to take advantage of the tragedy." The Maryland Republican Party, sticking up for congressional hopeful Andy Harris, scolded Rep. Frank Kratovil for trying to "capitalize" on the "worst environmental disaster in US history."

WASHINGTON -- Senate tax writers dropped an effort yesterday to extend one of the tax cuts President Bush strongly supports, underscoring a growing rift in the Republican-controlled Congress. The Senate Finance Committee left out of a $60 billion tax-cut measure an extension of a dividend and capital gains tax cut due to expire at the end of 2008. The action sets up a likely showdown with the House of Representatives, where GOP leaders support extending the lower tax rate for income derived from investment profits.

Pete Horrigan's letter laments the impact of the gas tax increase on Maryland families, but reading between the lines it is clear that the impact of the tax on oil companies is what really concerns Mr. Horrigan, who is president of the Mid-Atlantic Petroleum Distributors Association ("Maryland gas tax increase should be a nonstarter," Nov. 2). If the price of gas goes up, oil companies worry consumers will continue to downsize and switch to more fuel-efficient vehicles and electric cars.

MEXICO CITY -- In a dramatic move to combat this city's deepening air pollution crisis, President Carlos Salinas de Gortari ordered yesterday the immediate closing of the city's largest government-operated oil refinery.The decision to close the March 18 Refinery, which sprawls over 430 acres in the north of the city, will cost an estimated $500 million and will reduce the country's crude-oil refining capacity by more than 100,000 barrels a day.In addition, oil industry officials said it will force Mexico to import some kinds of gasoline until new refining capacity can be built.

WASHINGTON - Sensing as much political promise as peril in soaring gasoline prices, Vice President Al Gore has unleashed an unusually harsh condemnation of the oil industry, accusing energy companies of "collusion" and price "gouging." Gore issued a statement late Tuesday night decrying what he called oil industry profit gains of "500 percent in the first part of this year" and demanding an investigation into allegations of price fixing and collusion. "These enormous and unreasonable profits suggest that Big Oil is gouging American consumers," Gore said.

It's almost amusing to see President Bush vowing to get "aggressive on price gouging" at the gasoline pump. If he takes a good look at why gas accounts for a growing share of the family budget, he'd find contributing factors in which he is more than a little complicit - and for which he has few solutions: Federal refusal to demand vehicles be as Fuel-efficient as possible, which could save millions of barrels of oil annually. Enactment last year of more than $2 billion in tax breaks to the oil industry and a continuing waiver of royalties for deep-sea drilling at a time of record-high industry profits.

WASHINGTON - Consumers face higher gasoline pump prices today in part because a wave of oil industry mergers over the past decade reduced competition, according to a newly released government study. The merger of oil giants Exxon and Mobil in 1999 - when the two companies were Nos. 1 and 2 in the industry - added up to 5 cents to the price of a gallon of gasoline sold by the combined company. The General Accounting Office, an arm of Congress, looked at eight major oil industry mergers between 1994 and 2000 and found that six of them led to higher gasoline prices.