[Mgs] Oil company - non mg thread

[Mike Duvall]

At the risk of continuing this non-mg thread I felt I had to get my 2  
cents in since their have been so many posts about oil company  
profits.  Oil company profits when compared to other companies are  
not out of line.  They have  made better profits over the last few  
years as the worldwide demand for oil has skyrocketed. China is now a  
major user of oil.   The big numbers we here about oil company  
revenues being highest in history are true but that means only that  
there is a big market for oil.   According to the Washington Post,  
Exxon had a profit of 10% in the first quarter of this year and  
demand went up 1. 7 % for the quarter.

Much of the Exxon profit came because their refineries managed to  
stay open while other companies could not keep them open.

Now compare that to the greedy taxation place on oil and gas.   The  
average US tax on gas is more around the range of 15 to 20%.  The  
average is about  currently 40 to 50 centers  per gallon according to  
the Congressional Budget Office.  Now if Exxon has a profit of 10%  
and gas costs $3.00 that is 30 cents compared to the 15 percent taken  
by the government.

Certainly 10% profit is not unreasonable for a company.  You local  
car dealer makes more like 30% on a car without an investment - they  
borrow to put the cars on their lot.

In terms of return per share,  Oil companies are not that high  
either.  Record profits in 06 for Exxon were about $1.71 per share  
which and a share was $75.   While the stock has risen in the last  
year the current dividend yield is 1.53%  according to CNNMoney.com