The outstanding shares of U.S.-based oil and natural gas companies are primarily held by the middle class rather than the officers and board members of the companies, according to a new study by a Washington, DC-based economic advisory firm.

Across all U.S.-based oil and natural gas companies, less than 3% of outstanding shares are held by the officers and board members of those companies, while 50% of those shares are held by public and private pension plans, including 401(k)s and individual retirement accounts (IRAs),” said the American Petroleum Institute-commissioned study by Sonecon LLC.

An additional 20% of the shares are owned by individual investors who manage their own holdings (and are not corporate management), with the remaining 27% of the shares held by financial institutions and asset management firms, the study said.

All told, Sonecon said individuals other than corporate management own 70% of the U.S. oil and natural gas industry, while institutions own 27.2% of the industry and corporate management holds nearly 3%. It noted that the study clearly shows that ownership of oil and gas company shares is “broadly middle class.”

With respect to integrated oil and gas companies, corporate management owns 0.5% of the shares, compared to 42% owned by personal investors who manage their own holdings; 47% owned or held by asset management companies; 3% owned and managed directly by pension plans; and 7% held or managed by other institutions, according to Sonecon.

And corporate management owns less than 6% of the shares of nonintegrated (independent) oil and gas companies, Sonecon said. In contrast, it noted that 18.5% of the shares of these companies are owned by personal investors who manage their own holdings; nearly 76% are held or owned by asset management companies; 3% are owned and managed directly by pension plans; and 6% are held or managed by other institutions.

And in the oil and gas service sector, corporate management owns 4% of the shares of these companies, compared to 23% owned by other personal investors who manage their own holdings; 63% owned or held by asset management firms; 4% owned and managed directly by pension plans; and 6% held or managed by other institutions, it noted.

Because the middle class holds a large block of oil and gas company shares, an attempt by the Obama administration or Congress to increase taxes on the industry will hurt consumers more than the CEOs running the companies, said Kyle Isakower, API’s vice president for regulatory and economic policy.

“Policy proposals to increase taxes on U.S. oil and natural gas companies — or proposals that would not allow this industry to use the same business cost recovery provisions available to other industries through our tax code — can give the impression that if only a few rich companies or executives would pay more, the rest of America would have to pay less, or even nothing at all. The reality is far different: the owners of America’s oil and natural gas companies are largely retirees or middle-class Americans saving for retirement. The cost of higher taxes on this industry would be borne largely by them, not by CEOs,” he said.

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