Chevron CEO: Corn is not the answer

Change in Washington, domestic exploration and new sources of ethanol are required to meet the U.S. demand for energy.

NEW YORK (FORTUNE) – It’s either a great time (record profits, soaring share prices) or a terrible time (Capitol Hill’s scrutiny, the public’s ire) to be a Big Oil chief executive.

FORTUNE sat down with Dublin-born David O’Reilly, 59, the CEO of Chevron, the world’s fifth largest oil company. We asked him about what Chevron is doing to increase oil supplies, the company’s new biofuel plant in Houston, and why the United States’ 18 different grades of gasoline are making everyone pay more at the pump.

What’s your sense of the direction of the global oil market these days?

Clearly demand growth, because of the higher prices, has slowed. It’s still growing, but not as rapidly as it was. There are countries in Asia that have been shielded from the early rise in oil prices because of subsidies and price controls, that finally the governments have looked to their treasuries and said, ‘look, we need to do something about this.’ …. So I’m not sure the full effect of $70 oil has really hit the consumer yet in all of the Asian countries, but it’s beginning to.

How about in the United States?

In recent weeks there’s been a slowing, a few places where the demand has gone down. But year over year it’s been flat, maybe a few places up, but it’s certainly not gone down. At least not [in] our own numbers.

Fortune