>>> are subsidizing the most profitable industry. in our nbc/” wall street journal” poll 74% said it would end oil subsidies. our next guest is the author of the book “why we hate the oil company.” you are the former ceo of shell and you’re saying we should end the oil subsidies? that’s interesting, why?
>> in a high oil price environment, the actual subsidies are so small, they’re have very incidental to the business the size of the one i was formerly with and other major oil companies basically testified the same thing. but that’s when the oil price is high. when the oil price is low, subsidies make a big difference, because it may keep people drilling who would otherwise stop drilling but i also distinguish that smaller oil companies are different. so making a right decision is not putting all the oil companies you should the same paint brub, there has to be some distinctions made.
>> when oil is at $100, does it make sense to literally give the most profitable companies in the world an incentive to drill for oil? i mean, doesn’t that sound crazy? shouldn’t we craft a law at the bare minimum that says all right, if it’s low prices then we give yo a subsidy, if it’s high prices, no way.
>> i think there should be that kind of a bargain. but here’s an even more bargain. because i believe we need more oil produced domestically, so we don’t suffer the volatility we do, how about a discussion of raising the royalty rates in return for more drilling. that’s a discussion that i think would be great for the government and the american people. the oil companies wouldn’t mind because they would have more production. that would be a solution to the kind of problem we have right now.
>> all right, another thing is — why are we giving them a subsidy at all. if you can make money drilling oil, have at it, hoss. it’s a free market.
>> just about a decade ago, oil was $10 a barrel and we were shutting down the rigs in the gulf of mexico because nobody would drill. the clinton administration is the one who put the insentives in place.
>> they did it wrong, absolutely. thank you for your time. really appreciate it. appreciate your