Transcript: Fighting Big Oil
This is a partial transcript from "Your World with Neil Cavuto," December 1, 2005, that was edited for clarity.
NEIL CAVUTO, HOST: Remember this, five big-oil CEOs carted to Capitol Hill to justify their record profits?
Well, it wasn't enough for my next guest. He has demanded those same five companies come to his state and answer questions. And, today, representatives from those companies did just that.
So, is he satisfied?
Let us ask him, Governor Jim Doyle of Wisconsin.
Governor, how did it go?
GOV. JIM DOYLE, D-WISC.: Well, it is actually still in progress. But we have finished with the panel of the oil company executives.
And, you know, we asked them questions that were actually asked to us by Wisconsin citizens. And they really didn't have an answer to the obvious question, who made the 70 cents a gallon when it went up in one day? Although I think that the answer to that is obvious. And why did it go up, when there was not a great supply problem? In fact, there wasn't any supply problem. And I think they really grappled with those pretty basic questions that came to them. And I would say the answer, essentially, when you boil it down, was, we made the money because we could.
CAVUTO: All right. But you're, then, assuming they gouged?
DOYLE: I'm assuming that I think what happened is, the prices went up dramatically. We were told it was because there were supply problems.
There turned out not to be supply problems. The prices stayed up for six or seven weeks after that. They have crept down. Citizens in Wisconsin have paid about $113 million just over that increase right after Katrina. And I think that they ought to find a way to help people in Wisconsin and across the country deal with some of the real problems we're facing.
CAVUTO: All right.
CAVUTO: So, you're blaming them. You're not blaming the fact that oil is traded like a commodity, like a stock. Fear tends to run up the price of a commodity and a stock.
When those fears subsided, after the hurricanes, the fear factor, the premium factor, the supply factor, the demand factor, all alleviated, to the point now where we have seen a big drop, right?
DOYLE: Well, in fact, fear may have run it up, although they certainly would not acknowledge that. And they were asked very directly if that's what it was.
But it appears fear ran it up. But the fear subsided within a week or two, at least, when it was clear there were not major disruptions in the supply chain.
CAVUTO: But I'm well aware of that, Governor. But you know the markets and how they work, that just the perception that that might be the case is enough to lift the prices. And a delay in reopening refineries that have oil is itself a supply disruption, right?
DOYLE: Well, not really.
I mean, in fact, those supply disruptions did not happen. That's what the fear was, that because of refineries and reopening, it was going to be some kind of delay in the system. That didn't hit Wisconsin at all. We're not sitting in lines.
CAVUTO: All right. All right. We could argue back and forth on that, sir.
But would there be any ignoring just the data we have worldwide that economies are improving, that India, and China, and, yes, this country, are seeing a surge in demand like never before, and that it is punctuated by spikes like we had a few months ago?
DOYLE: There is no doubt that there are long-term economic factors at work. That does not explain why can go up 70 cents in one day and remain up for six weeks. That is really the issue here.
You know, in the first Gulf War, a number of oil companies said that, as their responsibility as Americans and so on, they were not going to raise the gas prices. What they did in the aftermath of Katrina was raise them sharply.
You know, an average family in Wisconsin, income of $40,000 a year, this year will pay $2,000 more in gasoline and home heating costs than what they did one year before.
CAVUTO: And you're saying the oil companies are the culprit, right, pretty much?
DOYLE: I think there is no doubt. I think the money went right out of our pockets and into their pockets.
CAVUTO: Governor, there is at least a source of debate here.
But thank you very much, Governor Jim Doyle of Wisconsin.
DOYLE: All right. Thank you.
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