Oil and Profits

Analysis:

The news reader basically told viewers that profits rose in the last quarter for two of the larger oil companies, Conoco/Phillips and Hess. The story was framed with this statement “After Hurricane Katrina, oil companies raised their prices and we all pay for it at the pump. Now we know how much of that money went to their bottom line.” Beyond that the only other information in the story was that Republican leaders were calling upon the oil companies to use their profits to build more pipelines.

There is no verification of the claim that the money went to the oil company’s bottom line, just the assumption that since profits are up the increased gas costs from Hurricane Katrina are unwarranted. Providing actual documentation about price gauging would have been valuable information for viewers, but that was not provided. What was missing is interesting. The channel 13 story said that the Republicans were encouraging oil companies to use profits for more pipelines, but the New York Times reported that Republican Senator Bill Frist said “If there are those who abuse the free enterprise system to advantage themselves and their businesses at the expense of all Americans they ought to be exposed and they ought to be ashamed.” This is different than saying that Republicans were calling for profits to be used for new oil pipelines. Another omission that would serve viewers well would be to look at which elected officials have received money from oil companies and if that has influenced government policy on energy regulation. In 2004 The Center for Public Integrity published a study looking at the amount of money oil companies gave politicians and found that from 1998 through 2004, a total of $440 million was given to politicians by oil companies. Ask yourself if any of this contextual information was provided if that would have changed this story significantly?

Story:

WZZM 13 News reader – After Hurricane Katrina, oil companies raised their prices and we all pay for it at the pump. Now we know how much of that money went to their bottom line. New tonight, Conoco/Phillips, the third largest oil producer said its net income jumped 89% in the last quarter for a record $3.8 billion dollars in earnings. Hess, the fifth largest oil company, saw its profits rose $272 million and that is just an increase of 53%. Republican leaders are calling on the oil industry to use its wealth to build new refineries and pipe lines.

Total Time: 34 seconds