In order to address the claim that ending handouts for Big Oil companies will raise the price of gasoline, Senator Harry Reid (D-NV) asked the Congressional Research Service to provide more information on "the extent to which proposed tax changes on the oil industry are likely to affect domestic gasoline prices."
CRS responded that, in ending Big Oil handouts, "there is little reason to believe that the price of oil, or gasoline, consumers face will increase" and that "[Since] prices are well in excess of costs???a small increase in taxes would be less likely to reduce oil output, and hence increase petroleum product (gasoline) prices"
CRS' four-page memo was delivered to the Senate Finance Committee earlier this week; overall, it provides significant support for the Senate's proposed tax changes for the top five most lucrative oil companies in the United States (BP, Chevron, ConocoPhillips, Exxon Mobil, and Shell).
The CRS memo also notes that the total tax revenues for those five Big Oil companies are only 5% of their earnings--therefore, ending Big Oil handouts would cut these firms' profits by only a nickel for every dollar they earn.