If you're wondering who owns "Big Oil," chances are good the answer is "you do."
If you have a mutual fund account, and 55 million U.S. households do, there's a
good chance it invests in oil and natural gas stocks. If you have an IRA or
personal retirement account, and 45 million U.S households do, there's a good
chance it invests in energy stocks.
It's a common mis-perception that oil executives are the only benefactors of
industry success. Instead, the bulk of 'Big Oil' benefactors are hardworking
men and women across America who boost their retirement portfolios through oil
and natural gas stock. In fact, only 1.5 percent of company shares are owned by
industry executives. The rest are owned by mutual fund investors, or those
planning for retirement with pension and IRA funds.
Stock Ownership of Oil Companies
As API Chief Economist John Felmy has noted: "When politicians seek to punish
these companies and 'take their profits,' they are not targeting industry
executives but the hard-earned savings of working people."
A study by economists Robert J. Shapiro and Nam D. Pham found:
* Almost 43 percent of oil and natural gas company shares are owned by
mutual funds and asset management companies that have mutual funds. Mutual
funds manage accounts for 55 million U.S. households with a median income of
$68,700.
* Twenty seven percent of shares are owned by other institutional investors
like pension funds. In 2004, more than 2,600 pension funds run by federal,
state and local governments held almost $64 billion in shares of U.S. oil and
natural gas companies. These funds represent the major retirement security for
the nation's current and retired soldiers, teachers, and police and fire
personnel at every level of government.
* Fourteen percent of shares are held in IRA and other personal retirement
accounts. Forty five million U.S. households have IRA and other personal
retirement accounts, with an average account value of just over $22,000.
For more information read the news release that accompanies the study,
including quotes from Shapiro, undersecretary of commerce for economic affairs
under President Bill Clinton, and Pham.
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