April 22, 2011 New York City, New York, NBC’s The Today show with guest host Willie Geist.
WILLIE GEIST, co-host: Mike Taibbi, thanks. Lou Ann Hammond is the CEO of drivingthenation.com. Lou Ann, good morning.
Ms. LOU ANN HAMMOND (Drivingthenation.com): Good morning.
GEIST: OK, so the trends here are not good. Gas prices have climbed every day for the last month. We’ve now seen six states already over$4 a gallon. Mike just reported it could go up to $6 a gallon in some places by this summer. What’s behind this?
Ms. HAMMOND: You know, it used to be that America had so much gasoline that they could use. We could get it from anywhere. But Libya being offline right now, 2 to 3 percent, that’s huge because we have emerging countries and they’re using a lot more gasoline than they used to do.
GEIST: Well, we just had that report from Libya. The violence in Libya has lead to Moammar Gadhafi stopping the exporting of oil, but the truth is the US doesn’t get much oil, if any, from Libya. So why does that affect prices here?
Ms. HAMMOND: Because other countries have to get it somewhere else. And they — they’ll get some of what we’re using and they’ll pay more for it than we would have paid. So it takes that supply pie and you have to divvy it up in different ways.
GEIST: So this is a supply problem?
Ms. HAMMOND: It’s a supply problem because we have people that won’t — that don’t want to use less. And so we — it does make the demand go up.
GEIST: Interesting yesterday that President Obama created this task force. He said, quote, “to root out any causes of fraud or manipulation in the oil markets that might affect gas prices.” Is there really price gouging out there, or is this purely political so the president can say, ‘Look, I’m concerned about oil and gas prices’?
Ms. HAMMOND: I think the president is concerned. But I think every president that has had — seen 5 or $6 a gallon has been concerned and has done this. So they’ve never really found price gouging, and so it’s not going to — probably not happen now. But it’s a good political move.
GEIST: And the ripples, of course, go far beyond the gas pumps with a story like this. Memorial Day, about a month or so away. People are going to be traveling a lot this summer. How does this impact consumer spending beyond what they’re paying for gas?
Ms. HAMMOND: It’s going to impact it in every way. The difference, though, Willie, is in 2008 when we had this gas raise — price raise again — before, there — the — used cars weren’t really in demand. But because of the Japanese shortage that we’re having, because the used car prices are so high, that if they want to sell the pickups right now, you can sell it at a good price and get a decent car that gets 40 miles to the gallon; some of them are getting 50 miles to the gallon. I was at the New York Auto Show for the last two days and the one question I asked every executive, ‘Is are you ready?’ And they have been saying, ‘Yes, we’re ready. We have Fiesta that gets 40 miles to the gallon. We have Mazdas that get 40 miles to the gallon. We have Chevy Volt that gets — electric.’ It’s only fitting that tonight at the Tribeca Film Festival it’s “Revenge of the Electric Car.”
Ms. HAMMOND: So…
GEIST: Maybe a silver lining here that we’re going to get better, more fuel-efficient cars out of all this. Gas at 3.85 a gallon and climbing. Lou Ann Hammond, thanks so much.
Ms. HAMMOND: Thank you.