Chevron CEO John Watson Interview With WSJ Removes All Doubt That He’s An Out Of Touch Hack

Written by Mike G

Topics: Oil

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Just in time for the anniversary of BP’s disastrous oil spill in the Gulf of Mexico, Chevron CEO John Watson did an interview with the Wall Street Journal to prove just how out of touch he is with reality.

He blamed the spill on the “cultural aspects and behavioral aspects” of the folks working on BP’s Deepwater Horizon rig at the time the disaster occurred. That’s right, he basically insulted the people who were victimized by BP’s disregard for worker safety. As Gulf Coast residents are remembering the loved ones they lost one year ago today, John Watson is using the tragedy to score cheap political and PR points. He’s truly a classy guy.

Chevron CEO John Watson wanted poster

We've been handing this "Wanted" poster out in Watson's hometown to enlist his neighbors' help in calling on him to take responsibility for his company's pollution in Ecuador and communities around the world. Click on the image to view a larger size.

But Watson didn’t stop there. He had plenty of other foot-in-mouth moments ready to go.

Watson is unapologetic about the destruction Big Oil companies are causing to our planet in their reckless pursuit of profits. Instead of taking any responsibility (just like in Ecuador!), he actually took the opportunity to whine about how Americans are taking dirty energy for granted. Seriously.

John Watson has apparently really had his feelings hurt by the entirely appropriate scrutiny fossil fuels industries have been under in the wake of the shocking number of dirty energy disasters we witnessed over the past year. So he’s striking back from his ivory tower — the type of digs you can afford when you make $14 million a year (an exorbitant salary, no doubt, but don’t worry, Chevron doesn’t have to pay any taxes so the company can afford it). Watson proclaimed that Americans have “a lot to learn” about how great and wonderful fossil fuels are.

What, in all his enlightenment, does Mr. Watson think we need to learn? For one thing, he’d like to scold us Americans for taking “affordable energy for granted.” It takes a lot of balls to say this to a country you’re fleecing at the pump with $4.00-plus gallons of gas. But, then again, I’m sure Watson hasn’t had to fill up his own tank in years.

Watson would also like to inform us that peak oil is a myth. Phew! And here we were all eager to move to infinite renewable energy sources because we were worried that a finite resource like oil might some day run out. Good to know that John Watson, magician, is on the case to make oil last forever!

Maybe Watson has someone else reading the news for him, too, because the IMF recently warned that “global oil markets have entered a period of increased scarcity.” Whoops!

But the really incredible pronouncement Mr. Watson made in his interview was that he “roundly disagrees with the finding of Mr. Obama’s spill commission that the ‘root causes’ of [BP’s Gulf of Mexico] spill were ‘systemic’ to the industry.”

Apparently Mr. Watson is hoping that we’ve all forgotten about how BP’s horrendously inadequate oil spill response plan was actually an industry standard. I refer of course to the spill response plan that talked about protecting species that don’t exist in the Gulf and listed a scientific expert as an emergency contact even though he’d been dead for years. Even if you have forgotten about that, I guarantee you that Mr. Watson remembers it well enough, because his company – like several other Big Oil companies, including Exxon, Shell, and ConocoPhillips – got busted for using the same exact oil spill response plans for their Gulf operations. We’re not talking similar plans with similar shortcomings, but the same exact plan cut and pasted. But no, no systemic problems to see here, folks. Move along, please.

Why would Watson lie about the industry-wide tendency to cut corners in order to maximize profits? Probably because his company just got the first permit to resume new deepwater drilling operations in the Gulf since the post-BP oil spill ban was lifted. Chevron is sinking billions of dollars into what the Houston Chronicle once called “a massive floating city” of offshore rigs in the Gulf. So it’s a lot more than convenient for Mr. Watson and Chevron that he failed to mention this damning evidence of systemic problems.

This type of self-serving misinformation is just business as usual for Watson and Chevron. What’s really incredible is that he is uncouth enough to trot out this drivel as the rest of the country is remembering a horrible tragedy caused by the very same cavalier attitude Mr. Watson is proud to display in this interview.

10 Comments For This Post I'd Love to Hear Yours!

  1. DJG says:

    I take it you’re counting on your readers not actually following the link to the original WSJ article, because you stretch the truth quite a bit with some of the words you put in Mr. Watson’s mouth here.

    1. You accuse him of saying that the workers on the rig were to blame when he referred to the “cultural and behavioral aspects” of the rig overall. This is a judgement of the management of the rig, not a dig at the working class as you want people to believe.
    2. Watson nowhere says that peak oil is a myth. In fact, the article specifically says “Mr. Watson doesn’t dismiss the idea” and then goes on to explain his position that the economics of increasing demand will drive technological solutions that will enhance oil recovery and increase supply.
    3. Watson says that he disagrees with the position that the root causes of the spill are systemic in the industry. You take issue with this but then talk about the failure of the recovery and don’t address the causes at all. If you’re going to argue a point, you really ought to stick to it.
    4. You have a problem with Watson’s phrase “taking affordable energy for granted” but then your use of the word “fleecing” only illustrates his point. The U.S. is certainly the world’s largest consumer of petroleum products and a lot of efficiency has been built up to make energy affordable in this country. However, now that energy use is increasing at an amazingly rapid pace all over the world, demand is seriously beginning to outstrip supply, making the products less “affordable” here because Americans now have to compete with the rest of the world for these products. Rather than recognizing these simple economic factors and focusing on conservation as a means of reducing demand, people choose to stick their heads in the sand, continue driving their SUVs and accuse those who supply the products of robbing, gouging or fleecing them.

    Also on that topic, a lot of work and a lot of money is being poured into renewable energy projects but they are far (meaning decades) from being anywhere near “infinite.” Watson is in no way wrong when he says, repeatedly, that we need all sources of energy, including oil and gas. The only other solution is for us all to give up our cars, our cell phones, our laptops and, shudder, our iPods.

  2. Mike G says:

    @DJG,

    I’d be quite comfortable with everyone clicking through and reading the WSJ article and would stand by everything I said in this post.

    1. “Cultural aspects” I’ll grant you probably refers to the management of the rig and the corporate culture that informed that management style, but what can “behavioral aspects” refer to other than the behavior of the people working on the rig? Regardless of this semantic game you’re playing to try and make it seem like I’ve misconstrued Watson’s words, the simple point I was trying to make is that a tragedy occurred, people died, an entire ecosystem was poisoned, and Watson is basically dancing on their grave, telling the world “We’re nothing like BP here at Chevron” to score cheap points for his company, which is every bit as dirty and reckless as BP.

    2.) You have conveniently stopped quoting the article a little abruptly, so let me complete the quote for you: “Mr. Watson doesn’t dismiss the idea but explains why it remains largely irrelevant.” I’ll grant that I took a bit of license in saying he called peak oil a “myth,” but I think any astute reader can see that I did so for dramatic effect. I also called him a magician — surprised you didn’t quibble with that since he’s clearly not magical at all.

    Watson is trying to argue that peak oil is “irrelevant” because technological innovation keeps making new oil accessible, and triumphantly crows about proven reserves increasing 130%. The irony here is that the only reason we need these technologies to make the oil accessible is because we’re talking about the last remaining oil reserves, the really hard to reach stuff that we couldn’t get to before, until these technological innovations made it possible to reach them. So his argument for why peak oil is irrelevant is actually an implicit argument for peak oil being very much a reality.

    3. I think maybe you need to read this bit a little more closely. I didn’t take issue with the recovery at all. I took issue with Watson saying there are no systemic problems in the oil industry even though all of the major oil companies were caught using the SAME EXACT deeply flawed oil spill response plan that BP used. If this isn’t evidence of systemic flaws, I don’t know what is. It’s a systemic problem that all of the major oil companies cut enviro and worker safety corners in order to save a bit of money and that federal regulators let them get away with it. It remains to be seen if we’ve learned our lesson from the BP spill.

    4. Now, here you have a point. I didn’t get into the nuances of Americans’ attitudes toward energy prices, though this is an important topic. I mostly agree with your assessment, in fact, but that wasn’t the point of the post.

    I was just pointing out the irony in Watson scolding Americans for taking “affordable” energy for granted when his company is selling gas for over $4 a gallon. It takes a special kind of arrogance for a man who makes $14 million a year off the backs of working folks to go to a publication like the WSJ and talk down to people for being upset about the high price of energy.

    Because of course what Watson conveniently failed to mention is that the particularly dirty energy he’s peddling isn’t “affordable” at all if you factor in the massive government subsidies Chevron and the oil industry receive from our government, paid with our taxes. There’s also the impacts to human health and the planet from Chevron’s business operations and the use of oil as a fuel to be considered — the costs of these impacts are borne by you and me because companies like Chevron refuse to take responsibility for the real costs of their business. So the whole suggestion that Watson’s dirty energy is “affordable” is laughable. The planet can’t afford it, and neither can we.

    Your closing line is a false choice built on a false premise, in my opinion. We only “need” all forms of energy until we’ve successfully phased in renewables. We could do without oil, coal, natural gas, and nuclear within a decade, I bet, if only we had the political will to stand up to entrenched powers and choose a healthier, more sustainable future. Renewable energy is clean and abundant — and yes, damn near infinite. The wind never stops blowing, the tide never stops going in and out, and the sun never stops burning (at least it won’t for millions of years). If we took away the billions we give fossil fuels industries and put that into developing renewable technologies and infrastructure in order to bring them up to scale and cost parity, we wouldn’t need fossil fuels at all, and could still have our cell phones and laptops — only powered by clean, green energy.

  3. CaptJach says:

    Don’t argue with DJG – He thinks this is an academic debate like in school.

  4. DJG says:

    1. Melodrama with no facts
    2. I did not conveniently stop quoting. I paraphrased the rest of the paragraph where Watson talks about the technology improvements which are helping to address the increasing challenges in finding oil. The words “largely irrelevant” that you latch on to are not Watson’s but are the WSJ reporter’s characterization of what Watson discusses. If anything, Watson describes what the industry is doing to address the threat of peak oil. You can stand by your assertion that “Watson would also like to inform us that peak oil is a myth” all you want, but it’s still a fabrication.
    3. Again, you’re stepping away from what’s discussed in the article. Watson says he doesn’t believe the root causes of the Macondo incident are systemic in the industry. All you talk about is the written recovery plans. You never address the root causes.
    4. 10 years is absurdly optimistic. It’s a fantasy. Yes, wind, sun and waves are infinite, at least, as you say, as long as the sun remains with us. Our ability to harness them, however, is what real renewable energy is and that is far from infinite. The technologies are still nascent and the distribution channels to get them to end users are either antiquated (the power grid) or don’t exist yet (gathering of cellulosic biofuel feedstocks, distributed billions of gallons of biofuels every year). We could pour trillions of dollars into these industries and it would still take 50 years to penetrate even a fraction of the existing energy use, much less the level to which energy use will have risen in 50 years. You can redirect all the tax credits you want and it would not change the timeline.

    I actually don’t know what all the oil industry tax credits are and have yet to hear anyone list them and describe why their bad. They’re usually created to spur investment in particular segments of the industry. For instance, $6 billion a year is poured into ethanol blending credits but that’s a whole other discussion.

    By the way, the suggestion that Chevron doesn’t pay taxes is another fabrication. Maybe it’s not yours originally but it’s not true. If you look at their annual statement, Chevron paid something like 40% of their earnings in income taxes. The myth that they paid nothing is based on someone looking at their 10K filings with the SEC and seeing that they got a tax refund last year. This is a tax refund like any other tax payer’s tax refund. It simply means that Chevron overpaid during the tax year vs. what their final tax liability was and got a refund, just like you can. Add to that the billions Chevron pays in sales and use and property taxes and it’s just absurd to claim they don’t pay taxes.

  5. DJG says:

    I wrote a whole lot more in response to Mike a couple of days ago, but it seems to have disappeared after I submitted it. I am in no way suggesting a conspiracy; glitches happen. I won’t rewrite the whole thing, but here are the key points I wanted to make.

    On number two, I did not conveniently stop quoting. I just paraphrased the rest of the paragraph. Watson talks about what the industry is doing to improve oil extraction technology in face of increasingly difficult to tap reserves. If anything, this is a discussion of how the industry is dealing with the threat of peak oil rather than a denial that it’s an issue. I did not quote the “largely irrelevant” phrase that you latched onto because that was the WSJ reporter’s characterization of what Watson discussed and not what Watson himself said. You can stand by the assertion that “Watson would also like to inform us that peak oil is a myth” all you want, but it’s still a fabrication. You are much fairer about what Watson said in your comment above, but in the article you accused Watson of saying something he didn’t say and then characterized it as a lie. No, you didn’t use the word “liar” but the intent of the “Phew!” and the “Whoops!” is pretty clear.

    On the final point, the idea that renewable energy could replace conventional technologies in a decade is an utter fantasy. Sure, sun, wind and waves are infinite but our ability to harness them is not. The technologies, though we’ve been tinkering with them for decades now, are still relatively nascent and still need time to develop even with billions being poured into them already. Add to that the infrastructure needed, whether it’s a significant upgrade to the electrical grid or an efficient distribution system for cellulosic biofuel or bioenergy feedstocks, and you’re still talking decades before renewable energy makes up even a quarter of the world’s existing energy demand, much less the level to which it will have risen by then. This is what Watson means when he says all sources of energy. Renewable energy is a great idea and it should be expanded as quickly and safely as possible but for the next couple of decades at least, it will be a supplement to existing resources more than a replacement.

    CaptJach, I am not trying to score debate points. It’s exactly that sort of cheap, shallow wordplay I’m arguing against here.

  6. Mike G says:

    @DJG:

    I think you and any other reader knows damn well I was being facetious there, so I’m a little perplexed as to why you’re so obsessed with this particular bit. You said “If anything, this is a discussion of how the industry is dealing with the threat of peak oil” — but that’s exactly the point: Watson is trying to laugh off the threat of peak oil, indeed the very notion that oil is going to run out some day, as if the industry will keep making new technologies to magically produce more oil even after every last drop has been pumped out of the ground. Even you have just agreed peak oil is a threat, but Watson is trying to cavalierly dismiss that threat. The reason he’d do this is pretty obvious: The fact that we’ve most likely already hit peak oil is the best reason for switching off of oil as a fuel as aggressively as possible, and Watson knows it.

    I don’t think all-renewable in a decade is an utter fantasy at all. Take away the billions of taxpayer dollars we throw at fossil fuels and plow that into a “Manhattan Project”-style mobilization, and I almost guarantee we’d find a way to make that a reality. The truly limiting factor is political will. Fossil fuels companies spend millions every year donating to political campaigns and lobbying incumbents, ensuring that those billions in subsidies stay in place and blocking policies that would spur investment in and growth of renewable technologies.

  7. Bdna says:

    Mike, come on … The entire post at the top and your responses are based on your limmited understanding, if you intention is to get people to defend the Watson, your blog is perfect… I know this is an opinion piece, but by spining context all you are asking for is for someone to read the article and correct you on the flawed theories, if you want for someone to get interested, do some research, analyze the context … These guys dont do off the cuff speaches or interviews… There is plenty of things you could actually point out, and usually is what the CEOs do not say, … Try again. Didnt buy it.

  8. Mike G says:

    @Bdna, I think you’re confusing snark for factual inaccuracy. Nothing I said was factually inaccurate. If you don’t agree with how I presented it, well then I’m sorry you don’t like my writing style.

    You said, “There is plenty of things you could actually point out, and usually is what the CEOs do not say”

    That’s exactly what I did, I pointed out all the facts he left out when he tried to absurdly claim that the problems that led to the BP spill weren’t systemic to the oil industry.

    But if you can think of more things he conveniently left out that I should have mentioned, I’d love to hear them. There are so many, I just had to prioritize.

  9. Edward Mwenda says:

    Mr. John Watson is a respected intellectual and a careful speaker. He represents a big portion of the industry. I think he was quoted out of contex since it is clear that accidents do happen since human beings are not perfect. Chevron and any other big companies also make mistakes through employees sloopiness.

  10. Edward M says:

    It is strange to note that just immediately after my comment of 27th October 2011. Chevron’s Brazil spill happen. What can we say about it? Who can we blame for that accident?

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