EnergyFactor By ExxonMobil | Pespectives has a new home


All Posts from August, 2012

Weathering Hurricane Isaac

Posted: August 30, 2012 by Ken Cohen

The appearance of Hurricane Isaac this week illustrates why we take steps year-round to be ready when severe weather events arise. ExxonMobil maintains a significant presence along the Gulf Coast, as the accompanying map shows. So we have to be prepared. The whole industry does, in fact, because the U.S. economy depends on energy production from the Gulf of Mexico.

If you were trying to think up a sure-fire way to undercut the competitiveness of U.S. oil and gas companies, you would be hard pressed to find a more effective method than the one just provided by the Securities and Exchange Commission. Earlier today the SEC voted new regulations into effect that will significantly disadvantage publicly traded oil and gas companies listed in the United States against our foreign competitors, especially state-owned national oil companies.

Earlier this month, the United States Energy Information Administration announced that “proved reserves of U.S. oil and natural gas in 2010 rose by the highest amounts ever recorded” since EIA began publishing proved reserves estimates in 1977. This record jump is stunning news, especially considering a general trend of decreasing production between 1980 and 2000. That trend is now being reversed.

One billion dollars every single day. That is the rough measure of the benefit the U.S. economy is estimated to receive by the end of this year thanks to the development of new supplies of oil and natural gas, according to a new analysis.

A lot of factors go into determining the price of gasoline, so it’s worthwhile every now and again to review them. A good piece in last Friday’s Wall Street Journal does just that, asking simply why gas costs what it does. The author – an analyst for a taxpayer watchdog group – gives a quick rundown of the basics, like crude oil costs, which can account for roughly three-quarters of the price consumers pay at the pump. Then there are expenses for refining, distribution and marketing. But he also reveals one slice of the gas price pie routinely overlooked by those who criticize energy companies or gas station owners for high prices. He writes, “The truth is that governments rake in a larger profit at the pump than anyone,” including companies like ExxonMobil.

Evidence continues to mount showing that the rise in oil and natural gas production from unconventional sources in the United States is yielding tremendous economic benefits for Americans. A recent demonstration comes courtesy of the team running the Brookings Institution’s Metropolitan Policy Program. Several weeks ago they launched an interactive version of their quarterly MetroMonitor feature, which examines the latest economic data to gauge the health of the 100 largest metropolitan areas in the United States.

  • Worth a deeper look...