Wednesday, April 30, 2008
John Hofmeister, president of Shell Oil, was interviewed by John Roberts on CNN this morning. Here are just a few paragraphs.
ROBERTS: Sen. Hillary Clinton wants to slap you with a 50 percent tax on what she calls windfall profit, profit above a certain level. Is that a good idea?
HOFMEISTER: Look at our revenues and our income for the last quarter. If we had made $7.8 million on $114 million of revenue, nobody would call that excessive, because that's 7½ percent. We made $7.8 billion profit on $114 billion revenue -- same 7½ percent. So to me that is not an excessive number when banks and pharmaceuticals and IT companies earn a whole lot more.
ROBERTS: Would it hurt you if she put in place this tax on the windfall profits?
HOFMEISTER: Sure it would. It would slow down investment. Taxing the oil companies was tried in the '80s. It drove us to do imports, which is exactly the problem we have today.
ROBERTS: Where is the top of all this? How high can the price of a barrel of oil go? How high will the cost of a gallon of gasoline go?
HOFMEISTER: I heard somebody say the other day it's as long as a piece of string. We don't know.
ROBERTS: The president of OPEC said $200 a barrel.
HOFMEISTER: Yeah, well, there are some countries out there subsidizing the cost of their energy to their consumers and industries to compete with America -- or against America -- because they think America won't solve the problem.
ROBERTS: You're saying you have no idea where the top is.
HOFMEISTER: We don't know. But we should produce more oil in this country.
ROBERTS: Sen. Hillary Clinton wants to slap you with a 50 percent tax on what she calls windfall profit, profit above a certain level. Is that a good idea?
HOFMEISTER: Look at our revenues and our income for the last quarter. If we had made $7.8 million on $114 million of revenue, nobody would call that excessive, because that's 7½ percent. We made $7.8 billion profit on $114 billion revenue -- same 7½ percent. So to me that is not an excessive number when banks and pharmaceuticals and IT companies earn a whole lot more.
ROBERTS: Would it hurt you if she put in place this tax on the windfall profits?
HOFMEISTER: Sure it would. It would slow down investment. Taxing the oil companies was tried in the '80s. It drove us to do imports, which is exactly the problem we have today.
ROBERTS: Where is the top of all this? How high can the price of a barrel of oil go? How high will the cost of a gallon of gasoline go?
HOFMEISTER: I heard somebody say the other day it's as long as a piece of string. We don't know.
ROBERTS: The president of OPEC said $200 a barrel.
HOFMEISTER: Yeah, well, there are some countries out there subsidizing the cost of their energy to their consumers and industries to compete with America -- or against America -- because they think America won't solve the problem.
ROBERTS: You're saying you have no idea where the top is.
HOFMEISTER: We don't know. But we should produce more oil in this country.
// posted by Buzz @ 8:16 PM 
