2008 Woodie Awards
Oil company owners grilled before Senate
By By Kevin G. Hall / Knight Ridder Newspapers
Issue date: 11/11/05 Section: News
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The Senate Energy and Commerce committees called in five oil industry captains to explain their controversial combined third-quarter profits of $32.8 billion and what are expected to be industry-wide annual profits approaching $100 billion. Those profits came from American consumers who paid more than $3 a gallon for gasoline this fall and face record home-heating costs this winter.
"My constituents, and actually most Americans, think that somebody rigs these prices. That in the process, somebody's getting ripped off, and they think it's them," said Energy Committee Chairman Pete Dominici, R-N.M., setting the stage for the nearly four-hour grilling.
Sen. Larry Craig, R-Idaho, was blunter.
"I must tell you, it's not terribly fun defending you," he said, adding that constituents besieged him at recent town hall meetings, demanding to know why Idaho's gasoline prices are 15 cents higher than the national average.
One by one, the executives recounted how hurricanes disrupted oil production and pipeline activity in the Gulf of Mexico and damaged oil refineries along the Gulf Coast. And they noted that even before hurricanes Katrina and Rita, a tight global market for oil supplies, caused partly by China's surging demand, had driven up gasoline prices around the world.
"We do not set or control the price of crude" oil, said John Hofmeister, president of Royal Dutch Shell's U.S. operations, which notched third-quarter profit growth of 68 percent over the same quarter in 2004. He was seconded by Ross Pillari, president of BP America Inc.
