Oil's Gusher

More embarrassing profits

Once again it was time for Big Oil's run for the money. And as last week's profit figures for the first three months of 1980 rolled in, even oilmen were again startled by their size. Though retail gasoline sales have been slow all year as high prices pushed many drivers off the road, the oil company earnings have never been better.

Exxon Corp., the nation's largest industrial enterprise (1979 annual sales: $79.1 billion), reported eye-popping profits of $1.93 billion, a 102% jump over the same quarter of 1979. Mobil, which since January has been under steady attack by the White House for the size and source of its profits, reported an equally stunning rise of 105%, to quarterly earnings of $922 million. Separately, Mobil agreed to forgo $30 million in permissible price increases under the Carter Administration's wage and price guidelines in exchange for a quiet settlement of disputed earlier price boosts.

Business has also been good for many of the smaller oil giants. Gulf Oil's profits rose 56% over the 1979 quarter, Shell Oil's were up 67%; Ashland's earnings jumped 74%, Conoco's soared 103%, Getty's leaped 109%, while Standard of Ohio racked up an earnings gain of a startling 169%.

Wall Street analysts do not expect the surge of profits to continue. Last year's enormous price increases that began in the second quarter in the wake of the Iranian oil cutoff have now begun to ease off somewhat. The U.S. recession makes any big new jumps in 1980 unlikely, and the enactment last month of Jimmy Carter's windfall-profits tax on the oil industry will now begin eating into profits.

Thus while total profits of the leading 25 oil companies have increased nearly 300% since 1972, the last full year of cheap energy prices, industry experts believe that the gushing profits of Big Oil may soon be slowing down.

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