By Peter Burrows 6/22/22 elburropete@gmail.com

I just took a quick look at Exxon Mobil's second quarter earnings. While Bernie Sanders and other morons rail on about the huge profits earned by the evil-dirty-bastard oil companies, the numbers show that America's biggest investor-owned oil company is about as profitable as the average electric utility.

Here we must distinguish between profits and profitability, a very important distinction that the average person should have some awareness of lest they be fooled by the Bernie Sanders of the world. Profits are in dollars; profitability is in percentages. For example, Exxon Mobile's 2Q profits were $8.8 billion, which is a helluva lot of money, but the annualized return on assets was only 10 percent.

That's about what Public Service of New Mexico, a regulated public utility, earns on assets.

Sometimes the profits/profitability distinction can result in a seemingly paradoxical situation where a company earning a large dollar profit is called "unprofitable." For example, if a company earns a billion dollars but has assets of 100 billion, the return on investment is only one percent and pundits will describe it as "very unprofitable," the "relative to assets" part being implied.

I also took a look at Exxon's profit per gallon of petroleum product sold. I didn't separate out profits from non-petroleum operations, such as chemical operations. That's too much work. I just threw all the profits into the petroleum sector, which may overstate the profit per-gallon a touch. I came up with 4.05 cents per gallon.

The Federal per gallon tax at the pump is 18.3 cents, and the New Mexico tax is 22 cents. That means we are paying ten times as much in tax per gallon as Exxon makes in profit per gallon.

My analysis was pretty quick, so if anybody would like to check my numbers, here is the URL:
https://corporate.exxonmobil.com/-/media/Global/Files/investor-relations/quarterly-earnings/1Q22-10Q-XOM.pdf