Thursday Mar 10, 201101:24 PM GMT
Exxon CEO: U.S. economy not yet feeling oil pain
Thu Mar 10, 2011 1:24PM
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Exxon Mobil CEO Rex Tillerson

Exxon Mobil CEO Rex Tillerson said on Wednesday that he doesn't think the recent jump in oil prices is hurting the U.S. economy -- at least, not yet.


The head of the world's largest publicly traded oil company said that in 2008, when oil surged to nearly $150 per barrel, Americans didn't change their driving and spending habits until gasoline prices topped $4 per gallon. Gas peaked at $4.11 in July of that year.


At $4, gas "creates some real challenges" for average American families and their household budgets. When gasoline rises above that, it's a "significant emotional event for a lot of people," he said. Canadian Press




Tillerson remembered that in 2008, Americans switched to taking the bus or joining community carpools to save on gas costs.


Tom Kloza, publisher and chief oil analyst at Oil Price Information Service, said Americans forced to live paycheque to paycheque are already cutting back on driving, Kloza said. That's not just in states like California, where gasoline is already above $3.90 per gallon. Canadian Press


"I don't know if that tip-over is still at the same $4 level or not," Tillerson told reporters at the New York Stock Exchange. "We'll see." Canadian Press





Oil is now about $104 per barrel after rising more than 20 percent over three weeks because of civil unrest in Libya. Tillerson hasn't seen any reduction in the demand for fuel from consumers or businesses. The national average for gas has increased 40 cents to $3.52 per gallon at the same time. Canadian Press


Drivers on the West Coast are already paying close to $4, however, and prices are expected to rise through spring and summer. Canadian Press


Earlier, the CEO [Tillerson] told Wall Street analysts that Exxon would spend nearly $100 million per day over the next five years on capital investments, mostly devoted to oil and natural gas production. Capital spending will range between $33 billion and $37 billion annually between 2011 and 2015, he said. Canadian Press


The American Petroleum Institute (API), which represents more than 450 oil and natural gas companies, has announced it will start donating to political candidates. Martin Durbin, API's executive vice president for government affairs says "our mission is trying to influence the policy debate." rawstory


The commission investigating the BP oil spill reported that API was in too compromising a position to set the standards -- the institute resists improving safety rules due to concerns over the costs. Huffington Post


According to the Center for Responsive Politics, the API spent $7.3 million to lobby Congress and the White House in 2010, ranking seventh behind six oil-and- gas companies. Bloomberg




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