'Bailout' for Oil Companies $20-40 Billion (and maybe more) every year
UXBRIDGE, Canada, Sep 30 (IPS) – Why do U.S. oil companies — some of the most profitable corporations on the planet — receive 20 to 40 billion dollars a year in subsidies from the U.S. government?
And, in a time of skyrocketing oil prices and profits, why did the George W. Bush administration in 2005 authorise an additional 32.9 billion dollars in new subsidies over a five-year period?
“Those are very good questions,” said Doug Koplow of Earth Track, Inc., an independent energy information research organisation in Boston, Massachusetts.
“I don’t have a good answer other than to say we’ve been subsidising American oil companies since 1918,” Koplow told IPS.
Koplow’s 2007 report to the Organisation for Economic Cooperation and Development puts the annual U.S. subsidy at an average of 39 billion dollars a year, when the costs of guarding oil lanes in the Persian/Arab Gulf, and the Alaska Pipeline are included. This does not include any costs from the Iraq war.
Official U.S. government statistics from the Energy Information Administration (EIA) offer a different picture, stating that the oil and gas industry only received 2.15 billion dollars in 2007.
“The EIA has a very narrow definition of what constitutes a subsidy,” said Koplow...