Oil refiner CEO advocates for higher fuel taxes
Filed under: Legislation and Policy
In recent weeks, as the price of crude oil and refined gasoline have continued to decline from their summertime highs, an increasing number of people have been jumping on the gas tax bandwagon. Many analysts and pundits have come out in favor of a tax to keep fuel prices high and encourage the use of more efficient vehicles. Two segments however, have been notable by their silence: politicians and the oil industry. I wouldn't expect any spineless politician to actually come out in favor of taxing gasoline back up to $3.50-4.00 a gallon, after all the only thing they really care about is the next election. Even President-elect Obama is opposed to it. However, it was surprising to see Paul Foster, the chairman and CEO of El Paso-based Western Refining come out of the closet in an interview the other day. Foster, a self-avowed conservative Republican normally opposed to taxes, actually favors a gas tax of at least $2 a gallon. He agrees that the only way to get people out of gas guzzlers and reduce our oil imports is to keep fuel prices high enough to discourage its use.
Should it happen? Absolutely! Will it happen? Almost certainly not.
[Source: CNN Money]
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Reader Comments (Page 1 of 1)
1-03-2009 @ 11:51AM
gorr said...
I said to keep fuel price down , up to 79Cents/gallon. This way we will see green technologies appear on the market. New technologies and cheap and non-polluting powered devises appear on the market when 'conditions' are good not when it's bad. Peoples don't observe what it's going on by themself, they are a mass of sheeps following collective hystery written in the 'news'. If gas is low then they think that everything is going well and will accept new products and new businessmans. If gas is high, then peoples will think that everything is going bad and will accept to burn their foods for some new 'energy', to kill themself and ruin themself in iraq and pay tax for studying batteries and give tax to everyone that is incompetant and worried to save the 100 years old auto-manufacturers.
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1-03-2009 @ 2:24PM
jeffzekas said...
My high school science teacher used to say, "Show me empirical evidence that your theory is correct!"... Okay, here it is: In Europe and the UK, there are high fuel taxes. They have cars that get better gas mileage than the US, they have developed alternate transportation (rail and bus) and they have built alternate electric supplies (nuclear, tide and wind). In the US, cheap fuel has meant: few if any alternate transportation systems and the death of existing rail and bus, few alternative fuels, bad gas mileage, and a dearth of changes or new technologies.
1-03-2009 @ 12:07PM
Rei said...
Don't act so surprised. My father is the CEO of a different major refiner, and I've not only heard him extolling the virtues of the Prius, but he's actually helping me finance the purchase of my Aptera 2e electric car. He's basically an overgrown Boy Scout who likes to spend as much time in the outdoors as he can (he climed Mt. Kilimanjaro last year), and wants to see the best solutions for our environment succeed.
Oil executives are people, just like everyone else. They just happen to be in an industry that everyone hates. Their product isn't polluting because they want it to be; it's polluting because it is. But everyone keeps buying it, and as long as there's a demand, they'll keep producing it. The solution is not to attack the suppliers; it's to undercut demand.
Don't pity the "poor oil companies", mind you; not only are they essentially guaranteed to still have business for a long time to come (inertia slowing down the move from gasoline to electric, some types of oil usage, such as jet fuel, being very hard to phase out, etc), but they'll switch businesses as appropriate. They're already some of the biggest players in the wind and solar world, and I wouldn't be surprised in the least to see them become big geothermal players if EGS plays out.
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1-03-2009 @ 12:34PM
Rom said...
IT's not that the oil companies are poor. They are not. Remember back when the economy began to slump. Oil companies were the only companies reporting record increases; some in the billions of dollars per quarter.
To me, that only proves that they would gouge us when they can.. And they did.
It's not just the luxurious life styles that use gas. The average person in New York takes a taxi or buss to work. Those use gas too and would cost more if the tax become a ridiculous 4x the value of the gallon.
Trying to get more people to use less gas would require more economic vehicles on the market.
I was excited about the Volt until I found out it costs 1/4 the value of my house. We're not all as rich as the children of the CEOs requesting the bloated tax.
1-03-2009 @ 12:46PM
Rei said...
"IT's not that the oil companies are poor. They are not. Remember back when the economy began to slump. Oil companies were the only companies reporting record increases; some in the billions of dollars per quarter."
Actually, right now is a complete disaster for oil companies -- especially refiners. Up until recently, the crack spread on producing gasoline was *negative*. That means you *lose* money on every barrel you refine. It's just barely positive right now, but not positive enough to pay for amortizing capital costs. Back when oil was high, producers had high profits, but this was misleading; profits were high partially because of the high crude prices, but also because there were shortages of equipment that they could use to invest in new production. They couldn't spend the money on their future effectively.
Refiners that are tied to diversified companies that had money from the spike and didn't pump it all into jacked-up prices on projects to produce oil that's way too expensive to be profitable now should survive okay, but those without such parent companies are in serious risk of bankruptcy.
FYI, your average football coach of a major college would have to take a big pay cut to be your average major oil company president or CEO. You could probably count the US oil execs that do better than the football coaches of major US colleges on one hand.
1-03-2009 @ 2:21PM
gorr said...
I said to put gas at 79cents/gallon, to let green algae fuel and foods hit the market, to stop subsidies and tax on everything, to stop war in iraq, to stop reguling small new business that want to put on the market a water powered car, truck, airplane, ship, u.f.o.
I said that this site serve to block new players not tied to high-financial banking-internet to enter the market because it's been set-up that way, help petrol and sell inneficient batteries and especially deceive the only competing product, hydrogen, to replace petrol.
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1-03-2009 @ 2:21PM
jeffzekas said...
My high school science teacher used to say, "Show me empirical evidence that your theory is correct!"... Okay, here it is: In Europe and the UK, there are high fuel taxes. They have cars that get better gas mileage than the US, they have developed alternate transportation (rail and bus) and they have built alternate electric supplies (nuclear, tide and wind). In the US, cheap fuel has meant: few if any alternate transportation systems and the death of existing rail and bus, few alternative fuels, bad gas mileage, and a dearth of changes or new technologies.
Reply