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NBC Today co-host Meredith Vieira opened her Today at the Pump segment cheering the recent decrease in gas prices as "sweet relief" but then wondered: "Would we be better off...if gas prices were even higher?" On this morning's Today show, Vieira invited on Chevron’s CEO, David O’Reilly, to harass him about getting America off its "dependence" on oil and cited critics of Chevron’s allocation of profits to find alternative sources of energy as merely, "symbolic."
The following exchange occurred on the June 21st edition of Today:
Vieira: "Would, would we be better off, sir, if gas prices were even higher, if it were four, five, six dollars a gallon? Wouldn't that provide the incentive we need to come up with alternative forms of gas and to stop this dependence that we have on foreign oil?"
David O'Reilly, Chevron: "Well I think, I don't think many people would like to see gasoline that high."
Vieira: "But would we be better off?"
O'Reilly: "I'm not sure that we would because it's a very important part of our economy. Our people drive to work, all of us drive to work. I'm sure you come to and from work in an automobile or a taxi and we need the people of America need affordable gasoline. So I think it's important that we supply that and that's why there's a lot of work going on to expand gasoline supply. Our refining system, for example, has been expanded to produce a million gallons a day more, over the last couple of years alone."
Vieira: "Let's talk a little bit about Chevron and, and profits. Since 2003 you've gone from, I think, it's $7.2 billion profits to, $17.1 billion. Where has that money gone and how much of it have you put into research and development of alternative sources of energy?"
O'Reilly: "Well the most important thing is that we made $17 million last year, that's the correct number, $17 billion. We've, and this year we are investing $19.6 billion in increasing supplies of energy of all types, gasoline, of course, which is very important. Jet fuel, diesel. We're also working on bio-fuels. We're working on other alternatives and we have our own energy efficiency company that actually sells energy efficiency as a, as a product, Chevron Energy Solutions. So I think we're investing both in the supplies of all types of energy as well as the demand."
Vieira: "But how do you answer critics who say it really amounts to just one-tenth of one percent of total sales? That it is symbolic, is more than symbolic, but not much more than symbolic?"
O'Reilly: "Well all new businesses start small. When we got into businesses in the past, they started small and they grew. So this is a business that was $50 million just five years ago. It's now in the three to $400 million range, so it's growing. And naturally you start small before you get bigger. But we're optimistic. We wouldn't be in this business if we didn't think energy efficiency was a very, very important value, given that, that, the crude oil is not renewable."
Vieira: "But, again, why not invest more than one-tenth of one percent of your total sales?"
O'Reilly: "Well we're investing $2.5 billion, which is substantially more than, than, than you've just calculated in our, in our total, alternative energy suite of products. Geo-thermal, other alternatives, bio-fuels, bio-fuels research but you have to start small before you can get bigger."
Related Items: "Big Oil" just can't win. The MRC's Business & Media Institute (BMI) has a new report about how the media hype high gas prices, sometimes as a pretext for government intervention in pricing or to levy new taxes. Also, BMI has noted that Vieira isn't alone is wanting higher gas prices. For example, CNN's Jack Cafferty advocated higher gas prices for SUV owners.