Big oil gets bigger

Oil prices have exceeded $117 a barrel this year [GALLO/GETTY]

A recent discovery of massive oil and gas reserves in Brazil made headlines but failed to have any effect on curbing soaring oil prices.

Last week the US said that the OPEC countries profits are likely to increase by 45 per cent reaching more than a trillion dollar from their oil sales this year.

But there are other benefactors. Although oil Companies are sending less oil into the market, risking a smaller buffer against supply interruption, oil companies are making unprecedented profits.

Shell, one of the seven oil companies which controls the world oil markets, made more than $27bn dollars in 2007. Exxon Mobil’s net profit rose to $40.6bn last year, with sales exceeding $404bn, which is more than the gross domestic product of 120 countries.

Then there are the governments of importing countries – when you pay high prices at the fuel pump, that is more because of taxes than anything else – from the 26 per cent the US government receives, to as high as 53 per cent and 58 per cent in France and Britain respectively.

Now with oil prices exceeding $117 a barrel, Inside Story asks how far it is likely to continue soaring, where is all the wealth going and are there any serious efforts to develop alternative energy resources?

 
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This episode of Inside Story aired on Sunday, April 20, 2008 at 17:30 GMT