Bill O'Reilly WRONG About Oil

I happened to catch part of Fox News commentator Bill O'Reilly's radio show this evening, and I must admit I was shocked to hear some of the positions taken by the popular media personality.

Of late I have found myself breaking ranks with O'Reilly on an increasing number of issues, but I was floored that he would spout the common 'blame the oil companies' mantra that one hears from Democrats in Congress.

To get straight to the point, O'Reilly is FLAT WRONG about oil.

In order to 'fix' the problem of rising oil prices, O'Reilly would punish the oil companies, as if they are the ones responsible for the problem, which they aren't. He also came close to spouting the Obama claim that the oil companies are guilty of 'price gouging,' though he stopped just sort of saying that.

Once again, let's set the record straight, shall we?

Out of every dollar we spend at the pump, 70 cents goes to purchase crude oil, most of which is imported from other countries. Crude is up by 100 dollars per barrel since 1998.

It doesn't take rocket science to figure out that most of the increases in gasoline prices at the pump over the last 10 years can be traced directly to the price of crude.

The big oil companies must purchase this crude, the price of which is set by the open market, OPEC, and investors/speculators.

Further, out of every dollar we spend at the pump, only about 3 cents goes to the big oil companies in profits.

But here is the biggie. Out of every dollar we spend at the pump, 6.5 cents goes for federal taxes, and anywhere from 15 to 20 cents goes for state and local taxes, depending on the state/municipality in which one lives.

As you can see, this leaves very little profit margin for local gas stations.

Thus, if Mr. O'Reilly wishes to play the blame game, he is picking on the wrong ones. Government at the federal, state, and local levels makes 8 times what the oil companies make in profits. And as long as crude oil accounts for 70% of the price we pay at the pump, Americans will see very little relief until the price of crude comes down.

And instead of brow-beating the oil companies for doing what a corporation is supposed to do--make a profit for its stockholders--why not brow-beat government for raking in multi-billions of dollars in taxes on gasoline? Why isn't anyone talking about or reporting how much government profits from these high gasoline prices?

It's very simple. They don't want you to know.

I can tell you this, the next time you hear a specific number on oil company profits, just multiply that number by 7, and you will get a ballpark estimate of what government is raking in from gasoline prices.

Those are the simple facts regardless of any demagoguery from O'Reilly or the Democrats.