Big Oil

Big Oil calls me dumb for resenting their "small" 9% profit margins in recent months and years. Today, a barrel of oil costs ~$50. Compare that to an identical barrel of oil that cost $140 six months ago.

The math: With a 9% profit margin, Exxon would break even on a $140 barrel of oil by selling it for only $127.40. Exxon has consistently profited by about $10 billion per quarter over the last couple years. So Exxon's break even point is $127.40/barrel. Roughly every dollar over $127.40 they charge, they make a billion dollars/quarter.

That means they should lose about $75 billion for every barrel they sell in Q4 08. Will they? Not a chance. They'll still make billions this quarter. How can this be? They've masked profits all along. The 9% profit margin they've suckered the country on is a load of crap.