U.S. GDP Slips on High Oil Prices, As Exxon, Others Report Robust Increase in Profits

WASHINGTON (April 28, 2011) - High oil prices contributed to a slip in growth for the American economy over the last three months, according to the Treasury Dept. Meanwhile, ExxonMobil today reported profits of nearly $11 billion in the first quarter of 2011, a 69 percent increase over the first quarter from 2010. Shell reported an increase of 22 percent to $6.9 billion in the same time period. Along with BP and ConocoPhillips, four of the five largest oil companies have now reported nearly $30 billion in profits in just the first quarter of 2011.

Responding to these divergent numbers for the American people and oil company shareholders, Rep. Edward J. Markey (D-Mass.), the top Democrat on the Natural Resources Committee, said today that this weeks' oil company profit reports, combined with the high price of oil, shows that tax breaks for oil companies aren't needed and should be eliminated to save taxpayers money and moved to develop clean energy alternatives to reduce America’s dependence on oil.

“In just the first 3 months of the year, Exxon has earned more profits than all of the tax breaks given to the major oil companies in an entire year,” said Rep. Markey. “There is absolutely no reason to continue to subsidize the most profitable companies in the history of the world. What is good for the biggest oil companies isn’t always what’s good for American taxpayers. The American people are getting tipped upside down at the pump, then asked to fork over whatever change they have left to subsidize these oil behemoths.”

“Speaker Boehner must bring legislation to the floor next week that will cut these tax breaks once and for all,” said Rep. Markey. “As Big Oil is reaching into one pocket of consumers at the pump, they are reaching into the other pocket through the tax code. At $112 dollars a barrel, the biggest oil companies don't need 100 year-old tax breaks to potentially make more than $100 billion in profits this year alone.”

Rep. Markey and Rep. Earl Blumenauer (D-Ore.) have introduced legislation to cut the budget by ending roughly $40 billion over five years in wasteful subsidies to the oil industry. The “Ending Big Oil Tax Subsidies Act” (H.R. 601) eliminates subsidies that have worsened the deficit, weakened our energy security, undermined our ability to drive investment in sources of renewable energy, and damaged the environment.

This week, Speaker John Boehner indicated that he is open to cutting some of these tax breaks.

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