Surprise, oil companies are turning big profits

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We were shocked, shocked to learn this week that giant oil companies aren't acting in the public interest.

According to testimony in front of a U.S. Senate committee, they are in the business of turning a profit. This apparently stunned a number of elected representatives, who called for windfall profits taxes, more regulation and price freezes.

The oil companies, including ExxonMobile and Shell, managed to turn catastrophic events such as Hurricanes Katrina and Rita into billions of dollars of income. They jacked up wholesale prices on gasoline to record levels.

And the public bought it. And is still buying it.

Want to know what 35 percent price increases did to fuel consumption in September? Knocked it down by 5 percent for a while, before it began to rise again toward pre-increase levels.

A year ago, gasoline was selling at $2 a gallon. Now, the nationwide average is $2.37 a gallon - and fuel consumption is higher (9.24 million barrels a day, compared with 9.21 million barrels a day last year.)

So while legislators and oil-company execs alike may hear a lot of complaining about high prices and ripoff prices, the driving public's actions speak louder. The price of gasoline has not yet reached a level at which people will actually reduce their demand.

Part of the reason, of course, is that energy policies enacted by Congress continue to promote highway construction and airline subsidies to a far greater extent than alternative transportation and gasoline conservation.

Senators can berate oil-company execs for making money hand over fist, but until the nation's energy policy turns away from oil, it's just a lot of hot air.