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By Samuel R. Avro on Jan 22, 2009 with no responses

ExxonMobil CEO Jokes: Gas Prices are “Too Low”

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Rex W. Tillerson, Chairman and Chief Executive Officer of Exxon Mobil Corporation.

ExxonMobil CEO Rex Tillerson joked to a reporter of a CBS affiliate in Dallas that gas prices were “too low.”

It may just have been in jest, but is there ultimately some sort of truth behind every joke?

His apparent joke came at a charity event where the CEO of the world’s largest publicly-traded oil company took part and made a donation.

When Tillerson was asked by the journalist to comment on gas prices, he replied, “You mean (that) they’re too low?” He then laughed off the comment and went on to give a more detailed answer.

“Well, the rapid run down in oil prices, there’s always a lag effect on gasoline prices on the way up and on the way down.  But the current situation is inventory levels are very high, both for crude oil and for some of the products.  They seem to have stabilized, and as they do, gas prices really had sunk lower than they should have based on the crude cost to the refiner.  So it was apparent that they would come back up to a level that would support ongoing gasoline manufacturing.  So they seem to be about in line with what you’d expect with current-day crude costs,” he said.

Consumers that were paying well above $4 a gallon for gas in the middle of last year, may not take kindly to a joke when it comes from the mouth of a major oil executive.

“I’m not surprised that he let his greed slip into that comment. The major oil companies actually believe that they deserve $4 a gallon,” said one New York resident.

The oil company shattered its previous record and set the largest quarterly profit record for a U.S. company when it raked in a net profit of $14.83 billion during the third quarter of 2008. It was a substantial increase from the $9.41 billion haul a year earlier.

Gas prices hit a national average high of above $4 a gallon in July when oil prices were trading above $147 per barrel. Since that time, gas prices have fallen to well below $2 a gallon, and crude oil has slid more than $100 per barrel.

Not everyone, however, thought bad of the CEO’s joke. In fact, some consumers went as far as agreeing that low gas prices are not necessarily a good thing.

“My personal belief is that prices are too low, and that only by establishing a price floor on gas will we be able to push both consumers and vehicle manufacturers to realistically put forth a more long-term effort towards finding more sustainable methods to solving our energy problems,” said Tim Barrera, a California resident who was forced to endure some of the highest gas prices in the nation.