Seeing Through Big Oil

Washington, D.C. –

A bill introduced this week by Rep. Barney Frank, D-Mass., would require oil, gas and mining companies to disclose to the Securities and Exchange Commission exactly how much they pay foreign governments for the extraction of natural resources. The idea behind the legislation, according to the bill, is to allow shareholders to more appropriately “determine associated risks” with investments in those companies.

The only problem: foreign companies that compete against U.S. companies, such as state-owned oil giants, aren’t subject to the SEC’s regulatory arm if they don’t do business in the U.S. That could put American oil companies like ExxonMobil, ConocoPhillips and Chevron at a competitive disadvantage to their foreign counterparts, oil advocates say.


“If you’re disclosing and the other guy doesn’t have to, you’re not really on a level playing field,” says Chris Joyner, a spokesman for the American Petroleum Institute (API), an industry group for oil and natural gas companies.

Coincidentally, the Saudi government Friday reportedly rejected Bush’s plea to increase production beyond a 300,000 barrel increase that began May 10. That sent the price of oil to a new record, just shy of $128 per barrel. Not bad news for a company like ExxonMobil, which reported an astounding 17% increase in first quarter profits earlier this month.

Forbes