Is oil's profit gush ending?

Jim Mulva, CEO, ConocoPhillips

More from Fortune

Inside Amgen with its CEO Ask the Economists: Another stimulus? Why prevention won't cure health care

FORTUNE 500 Current Issue Subscribe to Fortune

(Fortune Magazine) -- 1. Are record oil profits at an end?

Maybe. Although revenues are still rising thanks to record crude prices - FYI, oil's inflation-adjusted record high was $101 in 1980 - profits are down.

Earnings for Exxon Mobil (Charts, Fortune 500), ConocoPhillips (Charts, Fortune 500), and BP (Charts) are all lower through the first three quarters of this year vs. last year.

2. It was just last year that profits were so high there was talk of taxing them. What gives?

The price spread between a gallon of crude and of gasoline has shrunk from $30 in May to $5 today. Why?

The price of gasoline was flat, but costs rose at overtaxed refineries as they struggled to keep up.

That ate into profits at the oil companies' downstream businesses.

3. But gas prices are now rising. Won't that help?

Not enough. High prices have led to a race for scarce resources like rigs, engineers, and new wells. Costs are rising, and the big five's output fell 2.8% year over year this quarter.

The weakness of the U.S. dollar, oil's currency, doesn't help either. ConocoPhillips said it lost $155 million when it repatriated just its Canadian profits.

4. Will oil prices drag the rest of us down too?

So far we've shrugged it off; the GDP grew 3.9% last quarter. But rising oil prices were one reason for the market's recent wild swings.

And as gas prices start rising in sync with crude, consumer spending may feel the pain.