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TUCSON, Ariz. -- Oil companies have earned record profits in recent years while Americans have had to pay more at the pump. Nevertheless, Shell Oil Co. president John Hofmeister recently told a local TV station that it is all due to supply and demand.
"By the end of today, we will have used a billion gallons of oil in this country. Think about it, a billion gallons of oil," he said during an interview with KMSB-TV.
Hofmeister, who's been on a nationwide tour to talk about issues of energy supply and the need for alternative fuels, said there's a misconception that energy companies reap the benefits while consumers take a hit. "All of the profits are going back into the business. We're not sitting on a mountain of cash somewhere just counting our money."
The money goes back into developing more energy sources and technology, he said.
As for prices, Hofmeister explained they are based on the supply available and the willingness of drivers to pay for it rather than exploring other transportation methods.
The Federal Trade Commission released a study last week, saying it found no evidence of market manipulation by refineries and other fuel sellers for $3-a-gallon gas prices last summer. The FTC blamed the price hike on increased demand, increases in the price of crude oil, and refinery outages caused by Hurricanes Katrina and Rita.
For an in-depth look at Shell's nationwide tour, along with an exclusive interview with Hofmeister, check out the Sept. 17 issue of Convenience Store News.