Chevron’s profit came in almost four times what it was a year ago. Exxon posted a record quarter of its own. And you paid for the party at the pump, right around $4 a gallon in a lot of the country. The math here isn’t a mystery. A shooting scare in the Strait of Hormuz spooked the oil market, prices jumped, and the two biggest American producers were sitting on exactly the barrels everyone suddenly wanted. War over there. Windfall over here.
Now Congress wants a cut. A windfall-tax push is already making the rounds, the idea being that if the disruption did the heavy lifting and not the drilling, the profit isn’t really earned. Whether any of it becomes law is another story. Either way, follow the money and it lands in the same two places it usually does. Fortune has the numbers.
Every dollar Exxon and Chevron banked last quarter came out of your tank at $4 a gallon. When a shipping lane 7,000 miles away closes, the oil majors get a record quarter and you get to eat the spread, which is the whole reason a windfall-tax push is suddenly moving in Congress.
Watch that tax fight. If it passes, drivers get a rebate check. If it dies, the record quarters keep coming and the pump stays where it is.
The line for years was that oil companies live and die by prices they don’t control. Then a shipping lane gets tense for a few weeks and Chevron’s profit nearly quadruples. Turns out the wars they don’t start are pretty good for the balance sheet. And every dollar of that windfall showed up on a pump somewhere, which is why Congress suddenly remembers the phrase “excess profits tax” the same month drivers hit $4 a gallon.
Sources: fortune.com
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