Headlines and political speeches, even those from President Obama, focus on the oil industry's "record profits" but forget to tell the rest of the story.
Because the industry is one of the world's largest, and its revenues are based on the current high price of oil, profits in absolute dollars may indeed be setting company records - but the percentage of profits on those revenues is modest compared to other industries. An American Petroleum Institute publication, Putting Earnings into Perspective, used government filings and other data to report third quarter profit margins (earnings per dollar of sales) for a number of industries. The chart below shows that oil industry profit margins, at 6.7% in the third quarter of 2011, were lower than many other industries:
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