Is it really a shock that XOM (Exxon Mobil) saw a large increase in income? It shouldn't be. Since oil prices gained in the late summer, Exxon has been reaping the benefits of higher oil prices.

Today XOM released its 3Q earnings- showing net earnings of $7.35 billion on revenue of $95.3 billion, a margin of 7.7%.

Royal Dutch Shell also saw an increase in earnings, rising to $3.46 billion on revenue of $90.7 billion, a margin of 3.8%. Shell said income would have been higher had it not had to take losses in its refining segment.

ConocoPhillips also released earnings for the third quarter, showing earnings of $3.06 billion on revenue of $49.6 billion, a margin of 6.2%.

Exxon's profit this quarter is nearly half of what it was in 3Q 2008, when the company set a record for highest earnings in a quarter at $14.8 billion.

Surely there will be some motorists whom immediately think that this profit is too high and that oil companies should ignore the free market economy and should bless motorists with lower fuel prices, even though the U.S. already has some of the lowest prices of any industrialized country. Canadians pay nearly twice what U.S. motorists pay, and Europeans pay three to four times as much for motor vehicle fuels.

Just keep in mind that along with higher profits, oil companies have an increased tax burden. Such large companies typically pay tax at a rate of 35% or higher.