ConocoPhillips 2Q profit rises 65%

[BoogyMan]

Link Here (http://news.yahoo.com/s/ap/20060726/ap_on_bi_ge/earns_conocophillips;_ylt=AsoYSHdug80TAbV8tLsdi.uy BhIF;_ylu=X3oDMTA2Z2szazkxBHNlYwN0bQ--)

HOUSTON - Lofty oil prices fueled a 65 percent surge in ConocoPhillips' second-quarter net income, the company announced Wednesday. Its shares rose 2 percent in morning trading.
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The nation's third-largest oil company earned $5.18 billion, or $3.09 per share, compared with $3.14 billion, or $2.21 per share, in the second quarter of 2005. Results far surpassed Wall Street expectations, as analysts surveyed by Thomson Financial anticipated earnings of $2.81 per share.

Revenues rose 12.6 percent to $47.1 billion from $41.8 billion in the year-ago period.

Crude oil prices hit record highs during the quarter and continue to rise.

In the first six months of 2006, Houston-based ConocoPhillips earned $8.47 billion, or $5.49 per share, compared with $6 billion, or $4.26 per share, in the first half of 2005. Revenue for the first two quarters was $94.1 billion, compared with $79.4 billion a year ago.

Jim Mulva, chairman and chief executive officer, said that excluding its first-quarter $33.9 billion acquisition of Burlington Resources, the company has reinvested 97 percent of net income into growth and development of oil and gas resources.

The company's exploration and production segment almost doubled its net income to $3.3 billion from $1.9 billion in the second quarter of 2005, primarily because of soaring crude oil prices, inclusion of Burlington Resources' results and benefits from recent tax legislation in Canada.

The company's refining and marketing segment reported net income of $1.7 billion, up from $1.1 billion in the year-ago period, because of higher domestic refining margins partially offset by lower worldwide refining margins.

Does anyone else find this to be obscene?

[PittsburghAfterDark]

The made $5.18 billion on $47.1 billion in revenue.

That's an 11% profit margin.Â*Â*Nothing obscene about it at all.

[BoogyMan]

The made $5.18 billion on $47.1 billion in revenue.

That's an 11% profit margin.Â*Â*Nothing obscene about it at all.


I am trying not to take an alarmist position but I am still struggling with this one.

[PittsburghAfterDark]

You're only concerned about the amount. Look at the percentage.

Oil is a high risk and high reward venture.

How many dry holes have oil companies drilled? How little did the American public care in the late 80's when oil was at $10 a barrel and you could get gas for 82 cents a gallon? How many people were laid off as a result? Houston was decimated as was, nearly, the American oil industry.

This is all cyclical. Oil is a boom and bust commodity.

There are television stations that operate on 30-50% profit margins, I know, I worked for them. I've seen stations purchased for $15 million and 18 months later sold for $65 million. That's a 430% increase. That's obscene but it's also smart business and capitalism.

The amount of money is something most people can't wrap their minds around but you're talking about huge capital expenditures to bring oil to market. If you were buying DVD's for $10 and selling them for $11.49 you would say "There's not much money in that." but if you were selling 5,000,000 DVD's you'd be pleased as punch.

If you look at a $3.09 divedend being paid? That's going to stockholders. Now they can do several things with that money. Spend it, reinvest it or buy more stock.

Either way that's money that's moving and money moving makes the economy grow.

[lily]

What you say makes sense, PAD.......so much so, that I have to ask you, then why do we still give oil companies huge tax breaks to do exactly what you say they are doing with their profits?

[sbannon]

I have to admit that I'm sort of with PAD on this one. You can't fairly cry foul at success in America. Regardless of how it affects some people's pocket book, oil is a luxury product and oil companies have every right to earn whatever profits the industry can sustain for themselves.

Now, I also agree with Lily's remarks though, but not just towards the oil companies. I don't believe in tax breaks for any business which has seen 2 or more consecutive years of profitable operations. I do believe in assisting business, just as individuals, during hard times and to improve themselves. That's in the interest of all to do, so a perfectly acceptable use of government time and taxpayer's money in my opinion.

However, once a company/industry/individual is on their feet the assistance should stop. There comes a time when every person or business needs to sink or swim on their own.

[BoogyMan]

I don't know that I am actually crying foul, but those numbers really take my breath away.

[Mayberry]

oil is a luxury product Really? Since when? Seems pretty necessary to life as we know it to me. No oil equals no work, no products, no transportation, no shipping, no electricity.....back to the horse and buggy.

[sbannon]

Mayberry, oil is absolutely a luxury item. It's no more necessary to sustaining your life than a big screen T.V. is.

I think you're confusing the ability to maintain your lifestyle with the ability to sustain your life and there is a difference. Life can exist without oil, it has before. Perhaps not with the same lifestyle, but just because we've based our choices on the use of a product that doesn't redefine the product to be a necessity. It is a luxury.

[BoogyMan]

Mayberry, oil is absolutely a luxury item. It's no more necessary to sustaining your life than a big screen T.V. is.

I think you're confusing the ability to maintain your lifestyle with the ability to sustain your life and there is a difference. Life can exist without oil, it has before. Perhaps not with the same lifestyle, but just because we've based our choices on the use of a product that doesn't redefine the product to be a necessity. It is a luxury.


If you define oil as a fuel source product only, I might be able to see your point Sbannon, but that is not the case. Oil is used in thousands of products other than gasoline.

[sbannon]

BM, does that change the fact that human life itself is not dependent on oil? No, only our lifestyle is. That makes it a luxury product.

[Nathan Brazil]

The made $5.18 billion on $47.1 billion in revenue.

That's an 11% profit margin.Â*Â*Nothing obscene about it at all.


I am trying not to take an alarmist position but I am still struggling with this one.Â*Â*


It's called algebra.

[Nathan Brazil]

What you say makes sense, PAD.......so much so, that I have to ask you, then why do we still give oil companies huge tax breaks to do exactly what you say they are doing with their profits?


The better question is why should any company be taxed at all?

Companies don't pay taxes, they merely shift the tax on to the consumer.

[Nathan Brazil]

Mayberry, oil is absolutely a luxury item. It's no more necessary to sustaining your life than a big screen T.V. is.

This is total ignorant nonsense.

Turn all the oil into water on Tuesday and the world will be starving by Saturday.

No oil, no transportation. Anyone here think Los Angeles County can feed it's 10 million residents on produce grown inside the county? Anyone think all that corn can be harvested today by men with horses?

Oil is the present skeleton of our economy. Not just the back bone, but the arms, legs, and even the little anvil and stirrup bones in the ears (telecommunications don't work without electricity).

Yep, there's alternatives, but oil and it's related fossil fuels are what makes the world go round and round today.

[sbannon]

Nathan, you're doing the same thing Mayberry did earlier, confusing lifestyle with life dependent. Answer this question, did the human race exist before the uses for oil were discovered?

Of-course it did, so life is not dependent on oil. Now, our modern lifestyle is because of our own choices, but life itself is still not dependent on oil, so it is a luxury product.

As for your extremist examples, how about some of those 10 million residents of LA County grow their own gardens? If you can't get enough food into an area, move to another area? All of these people depending on an oil based economy to bring food to them and remain living there are choices in lifestyle. It doesn't make life dependent on oil, it makes the lifestyle.

Our economy is based on oil. That was by choice and again falls under lifestyle. Telecommunications and electricity, also luxury items that life can exist without. Just because we've become dependent on these things doesn't somehow magically redefine them as something life depends on, only our lifestyles.

Life depends on shelter and food. Some might add clothing as mobile shelter from the elements and I'd accept that. None of these absolutely require oil, and anything/everything else is a luxury for our lifestyle.

[BoogyMan]

It's called algebra.

Do you take a bow after lines like that one? :) You obviously missed the point. The profit being made by oil companies is staggering. I don't really have a problem with high profit margins but I do feel that the current world instability is being used as a pretext for gouging.

[BoogyMan]

BM, does that change the fact that human life itself is not dependent on oil? No, only our lifestyle is. That makes it a luxury product.


I cannot go there Sbannon, your definition of luxury product doesn't seem to be a coherent one to me. If you consider anything that facilitates a modern existence to be luxury I find that a bit extreme.

[Mayberry]

your definition of luxury product doesn't seem to be a coherent one to me. If you consider anything that facilitates a modern existence to be luxury I find that a bit extreme. I gotta agree with that one. I'm sure sbannon will be one of the LAST to be living in a cave.

[sbannon]

Okay, so because we've placed so much of our economy into the the micro-chips of computers is life now dependent on computers too? How about cable/dish television. I mean very few people remember the old Rabbit-Ears on top of every T.V. set today so are we now life dependent on cable? Where does this line of thinking end?

To complain about Oil Company profits with the argument that oil is a necessity now just because we've chosen and enjoyed using oil to make life easier for ourselves would be like me complaining about the Butcher charging higher rates for Prime Rib than Pork Chops just because I prefer Prime Rib and claim I will starve without it. But it's not true, I could eat the Pork instead and acknowledge that Prime Rib is a treat or luxury.

Life either depends on something, or it doesn't. That's black and white. If it doesn't then it's a luxury product which may support our way of life, but it isn't supporting life itself.

Is my argument a bit extreme? Perhaps, but is it inaccurate? Not at all.

There is no grand life-sustaining need for--or entitlement to--oil. Because these statements are true oil companies should be free to charge whatever prices and earn as high of profits as they wish, and neither consumers nor government should be able to do anything about it. That was my point.

[BoogyMan]

A short list of products made from oil, excluding gasoline is listed below.

Sbannon if your point is that life goes on without oil, you are exactly correct, but it certainly is NOT a luxury only product, it is a very important product to modern living.

Clothing Ink
Heart Valves
Crayons
Parachutes
Telephones
Enamel
Transparent tape
Antiseptics
Vacuum bottles
Deodorant
Pantyhose
Rubbing Alcohol
Carpets
Epoxy paint
Oil filters
Upholstery
Hearing Aids
Car sound insulation
Cassettes
Motorcycle helmets
Pillows
Shower doors
Shoes
Refrigerator linings
Electrical tape
Safety glass
Awnings
Salad bowl
Rubber cement
Nylon rope
Ice buckets
Fertilizers
Hair coloring
Toilet seats
Denture adhesive
Loudspeakers
Movie film
Fishing boots
Candles
Water pipes
Car enamel
Shower curtains
Credit cards
Aspirin
Golf balls
Detergents
Sunglasses
Glue
Fishing rods
Linoleum
Plastic wood
Soft contact lenses
Trash bags
Hand lotion
Shampoo
Shaving cream
Footballs
Paint brushes
Balloons
Fan belts
Umbrellas
Paint Rollers
Luggage
Antifreeze
Model cars
Floor wax
Sports car bodies
Tires
Dishwashing liquids
Unbreakable dishes
Toothbrushes
Toothpaste
Combs
Tents
Hair curlers
Lipstick
Ice cube trays
Electric blankets
Tennis rackets
Drinking cups
House paint
Rollerskates wheels
Guitar strings
Ammonia
Eyeglasses
Ice chests
Life jackets
TV cabinets
Car battery cases
Insect repellent
Refrigerants
Typewriter ribbons
Cold cream
Glycerin
Plywood adhesive
Cameras
Anesthetics
Artificial turf
Artificial Limbs
Bandages
Dentures
Mops
Beach Umbrellas
Ballpoint pens
Boats
Nail polish
Golf bags
Caulking
Tape recorders
Curtains
Vitamin capsules
Dashboards
Putty
Percolators
Skis
Insecticides
Fishing lures
Perfumes
Shoe polish
Petroleum jelly
Faucet washers
Food preservatives
Antihistamines
Cortisone
Dyes
LP records
Solvents
Roofing

[Nathan Brazil]

Answer this question, did the human race exist before the uses for oil were discovered?

Not six and a half billion. And if there were no oil tomorrow, there wouldn't be six and a half billion by the end of August.

Welcome to the real world.

[Nathan Brazil]

It's called algebra.

Do you take a bow after lines like that one? :)Â*Â*You obviously missed the point.Â*Â*The profit being made by oil companies is staggering.Â*Â*I don't really have a problem with high profit margins but I do feel that the current world instability is being used as a pretext for gouging.




Someone calculated the profit margin to be about 11%. That ain't no "high" profit margin. Respectable, but not amazing.

[sbannon]

Not six and a half billion. And if there were no oil tomorrow, there wouldn't be six and a half billion by the end of August.

Welcome to the real world.

Eww, gee Nathan, you've really opened my eyes to reality now... wait, I was wrong you haven't.

First, you make a drastic claim with no supporting evidence what so ever. Second, even if you're 100% correct (which I'm not suggesting you are) would that somehow magically redefine life as dependent on oil? Nope.

That's the real world. Life exists independent of oil.

[Mayberry]

Good, life will continue to exist without oil. So let's get rid of it. Shut everything down. No electricity, no transportation, no groceries, no information. Suits me fine. Now I don't have to make any more car payments. No more electric bills. Guess my mortgage just became null and void. We can all plant a veggie garden and sit in the dark singing Cum Ba Yah. Oh, o.k. I guess I could run a light bulb or two if I tie the alternator off my now useless truck to a windmill. Hey! I can tow the truck with a horse or two. Will I have to renew my registration still? Nope! The computers are dead! Darnitall! You mean I gotta go fishin' for dinner again?!:P

[Nathan Brazil]

Not six and a half billion. And if there were no oil tomorrow, there wouldn't be six and a half billion by the end of August.

Welcome to the real world.

Eww, gee Nathan, you've really opened my eyes to reality now... wait, I was wrong you haven't.

First, you make a drastic claim with no supporting evidence what so ever. Second, even if you're 100% correct (which I'm not suggesting you are) would that somehow magically redefine life as dependent on oil? Nope.

That's the real world. Life exists independent of oil.


The obvious doesn't require supporting evidence, that's why it's called "obvious". You should get your head out of your ass, that's why you can't see what we're saying when you open your eyes.

[sbannon]

The obvious doesn't require supporting evidence, that's why it's called "obvious". You should get your head out of your ass, that's why you can't see what we're saying when you open your eyes.

So what you're saying there is "I got nothing to support my claims so here's some profanity for you"?

I'm afraid I can't argue on your level Nathan, I'm just too old to stoop so low. When you mature a little we can try discussing issues again.

[Churchel]

Since this thread went from respectable topic to mental circlejerk I will weigh in my two cents:

We had a cheap dirty way to run our transportation sytem, and that is waning. We need to strive on eliminating fossil fuels entirely but until then we need to moving away from imported fossil oil. Brasil is energy independant, it took them 30 years, we should be able to do it in 15.

I believe it is wrong to allow the market to run up the cost of a commodity if there is no need. The stock should be converted into a bond and the government needs to further regulate the spending behind oil. Since it is a matter of national security I expect a full effort to ensure the future of america does not depend on a volitile region.

The sole purpose of business is to generate money, I believe the sole purpose of government is to improve lifestyle.

[Nathan Brazil]

Since this thread went from respectable topic to mental circlejerk I will weigh in my two cents:

We had a cheap dirty way to run our transportation sytem, and that is waning.Â*Â*We need to strive on eliminating fossil fuels entirely but until then we need to moving away from imported fossil oil.Â*Â*Brasil is energy independant, it took them 30 years, we should be able to do it in 15.

I believe it is wrong to allow the market to run up the cost of a commodity if there is no need.Â*Â*The stock should be converted into a bond and the government needs to further regulate the spending behind oil.Â*Â*Since it is a matter of national security I expect a full effort to ensure the future of america does not depend on a volitile region.

The sole purpose of business is to generate money, I believe the sole purpose of government is to improve lifestyle.



Ummm...someone owns a commodity. If he'd rather sell it at $80 a barrel instead of $10, what are you going to do about it?

Oh! I KNOW! Let's invade Iraq and STEAL the oil. So I take it you're a right-wing Republican fanatic?

[Nathan Brazil]

So what you're saying there is "I got nothing to support my claims so here's some profanity for you"?

No, what I"m saying it that you're walking into the steel reinforced concrete columns supporting the bridge of my arguments and insisting that I'm punching you in the nose.

[Churchel]

Since this thread went from respectable topic to mental circlejerk I will weigh in my two cents:

We had a cheap dirty way to run our transportation sytem, and that is waning.Â*Â*We need to strive on eliminating fossil fuels entirely but until then we need to moving away from imported fossil oil.Â*Â*Brasil is energy independant, it took them 30 years, we should be able to do it in 15.

I believe it is wrong to allow the market to run up the cost of a commodity if there is no need.Â*Â*The stock should be converted into a bond and the government needs to further regulate the spending behind oil.Â*Â*Since it is a matter of national security I expect a full effort to ensure the future of america does not depend on a volitile region.

The sole purpose of business is to generate money, I believe the sole purpose of government is to improve lifestyle.



Ummm...someone owns a commodity.Â*Â*If he'd rather sell it at $80 a barrel instead of $10, what are you going to do about it?

Oh!Â*Â*I KNOW!Â*Â*Let's invade Iraq and STEAL the oil.Â*Â*So I take it you're a right-wing Republican fanatic?


I suggest re-reading my post and your post.Â*Â*I suggest removing it as a commodity, eventually eliminating its value.Â*Â*You talk about cheney and the secret energy talks.Â*Â*I am not pointing towards anything specific.Â*Â*You drop to namecalling.Â*Â*Do you have any particualar reason to respond that way? How much oil stock to you own?

[Nathan Brazil]

I suggest re-reading my post and your post.Â*Â*I suggest removing it as a commodity, eventually eliminating its value.

Oh? How do you do that? OH! You STEAL, then give it away for free to anyone and everyone that asks for it, with no limits on the quantity distributed to any individual or group. If you do aught else, you've re-introduced scarcity and scarcity automatically introduces pricing and influences demand and you've merely transferred ownership of the commodity from people who might have a legitimate claim to ownership to your favorite group. That's all.

You can't de-commoditize (?) a commodity. If you're going to argue otherwise, explain how or don't waste our time.


You talk about cheney and the secret energy talks.

No I haven't. That's a lie.

[Churchel]

As far as cheney, in your post you talk about iraq and stealing oil. That was a pathetic twist of words. Again go and re-read my posts, if you have a problem comprehending have one of your neighbors kids draw this out for you.

Converting a stock to a government bond "lets call it an energy bond" is a way for no one to lose out. If you are street-smart future trade boy that is making money off oil then I understand your frustrations, but I sincerely doubt that.

As far as eliminating a commodity, do me a favor and find out what whale oil is trading at today.