Art Zadrozny of West Chester, PA, writes in response to my column on ExxonMobil’s stinginess:
Did you not read your own words in the article about Exxon’s approach to oil exploration? Why would the company want to put itself in the same situation it found in 1981 – investing heavily in development, only to see the market bottom out and profits lag?
The real issue is the limited opportunities for ExxonMobil and other majors to find new oil. You would do readers better service by highlighting this as a consequence of world politics, not Exxon’s business philosophy.
True, Exxon always was more risk adverse than the smaller oil companies, but your article does not do justice by caliing Exxon’s approach stingy, it only feeds the public mindset that big oil is out to rip us all off and actually has some control over prices.
Exxon’s profits of less than 11% are not out of line with other corporate sectors either, and there is no guarantee that oil will stay at $65/Bbl. World prices could just as easily drop IF tensions in the Middle East calmed down.
If I sound like a oil company supporter, well, maybe it’s becaused I worked in the industry for 25 years. But that relationship, as well as my stock holdings, ended 9 years ago. (I wish I had held the stock positions, but at the time, things did not look so good.)
I don’t really disagree with Art’s analysis. I just can’t quite bring myself to depict the most profitable company in the history of the planet as purely a victim of circumstances beyond its control.