Oil giant Exxon Mobil Corp. and leading refiner Valero Energy Corp. cashed in on soaring gasoline prices during the first three months of the year -- an accomplishment that on Thursday produced upbeat profit reports as well as a new chorus of condemnation from consumer advocates and politicians.
Exxon said its first-quarter profit jumped 10% to $9.3 billion, or $1.62 a share, as higher income from its refineries, gasoline sales operations and chemical plants more than offset a drop in production profits caused by lower prices for crude oil and natural gas.
The results at Irving, Texas-based Exxon were a company record for the first quarter, although not high enough to top the records it set last year. They represent a new twist for Exxon, however, because the gains did not come from soaring oil and natural gas prices, which drove its stunning 2006 income.
"It's an incredible, incredible hot streak for refiners right now," said Tom Kloza, chief oil analyst at Oil Price Information Service in Wall, N.J. "And so far, April makes the first quarter look pedestrian."
On Capitol Hill, eight freshmen senators seized on Exxon Mobil's profit news to launch a drive to pass energy legislation that would include instituting a windfall profits tax and rolling back oil industry tax breaks.
In California, the Foundation for Taxpayer and Consumer Rights provided a scathing response to Exxon's earnings report.
"When refining profits are driving world-record profits, that means motorists are being gouged," said Judy Dugan, research director at the Santa Monica-based consumer group. "Congress and would-be regulators ... should be demanding an end to profiteering by Exxon Mobil and its Big Oil brethren."
The backlash stems from a nationwide surge in retail gasoline prices that was unusual both for its size and its timing.
The U.S. average cost of self-serve regular rose more than 65 cents a gallon during a 10-week period beginning in February, before sliding less than a penny to $2.869 a gallon last week, the Energy Department reported Monday. Those increases hit motorists earlier than in previous years and well before the start of the traditional summer driving season.
The increases were highest in California, where the average pump price for regular gasoline passed the $3-a-gallon mark in mid-March, about a month earlier than in 2006. The statewide average price of $3.316 reported Monday was just shy of the record price of $3.332 hit last May.
