Oil Companies Studied by Congress

Did you know that the major oil companies increased their profits by 128% from 1978-1980, while profits of non-oil companies remained unchanged?

Or that during the same period, oil company profits rose from less than 25% to more than 40% of the total profits of all Fortune 500 companies?

Or that Exxon made almost $1 billion in profits per month in 1980?

These astonishing facts appear in a 19-page report prepared by a U.S. congressional committee in November. The study is titled "The Changing distribution of Industrial Profits: The oil and gas industry within the Fortune 500, 1978-1980."

The report shows that the oil companies prospered handsomely in the 1979-1980 recession when companies in virtually every other sector of -the economy were suffering. "In 1980, non-oil companies saw profits fall by $5.2 billion compared with 1979," states the study, while oil company profits were rising by $19 billion.

This "massive shift in the distribution of profits," the report says, is historically unprecedented; it is "much more extensive than that which occurred following the Arab embargo in 1973-1974."

Such change in the basic structure of the American economy is "alarming;" says Michael F. Barrett, Jr., chief counsel and staff director for the House subcommittee on oversight and investigations for energy and commerce, in an introductory statement to the report he helped write.

"We have seen the redirection of economic strength into one industry - energy - at the expense of the rest of the industrial base," Barrett explains. "Capital that would have been available to rebuild American industrial machinery across the economy has been diverted into energy and especially into the oil and gas industry."

For a free copy, write:

Energy & Commerce Comm.
House of Representatives
Rayburn HOB, Rm. B334
Washington, DC 20515