Big Oil denies responsibility for skyrocketing gas prices

Americans hoping to hear the nation’s leading oil industry executives say that lower gas prices are in the offing had to settle for this: Don’t blame us.

The top officials of the five largest U.S. oil companies appeared before a congressional committee Tuesday to explain the skyrocketing fuel prices and to justify their companies’ record profits.

On fuel prices, the explanation was brutally straightforward: It’s not our fault; it all has to do with the price of crude.

As for the $123 billion in profits that Shell Oil Co., Exxon Mobil Corp., BP America Inc., Chevron Corp. and ConocoPhillips earned last year, the top executives told members of the committee chaired by Rep. Edward Markey, D-Mass., that such earnings were in line with other industries.

“Our earnings, although high in absolute terms, need to be viewed in the context of the scale and cyclical, long-term nature of our industry as well as the huge investment requirements,” said J.S. Simon, senior vice president of Exxon Mobil Corp., which made a record $40 billion last year.

“We depend on high earnings during the up cycle to sustain ... investment over the long term, including the down cycles,” he continued.

Of course, none of the executives ventured a comment about the negative effects high fuel prices are having on the overall economy. For instance, 80 percent of all the goods in this country are transported by trucks that use diesel fuel, and diesel now costs about $4 a gallon in some parts of the country.

April Fool’s Day

It is appropriate that the hearing was held on April Fool’s Day, given the way Big Oil attempted to pull a fast one on the representatives of the American people.

Not only did the executives offer no apologies for their profits or give motorists a reason to believe that gas prices will come down soon, they insisted that the tax breaks they received in 2004 should not be touched.

An energy bill that has passed the House but has been stalled in the Senate would take away the cuts, expected to total $18 billion over the next 10 years.

Democratic members of Congress would use the money to develop alternate sources of energy, which they say Big Oil should be doing now.

Several lawmakers noted the rising price of gasoline at the pump, now averaging $3.29 a gallon amid talk of $4 a gallon this summer.

But even with the national pain at the pump, Republicans in Congress are reluctant to point the finger of blame.

GOP lawmakers called for opening more areas for drilling to boost domestic production of oil and gas.

That’s exactly what Big Oil wanted to hear.

“We need access to all kinds of energy supply,” replied Robert Malone, chairman of BP America, adding that 85 percent of the country’s coastal waters are off limits to drilling.

Blinded by dollar signs

The top executives of America’s largest oil companies had the chance Tuesday to show the American people that they are willing the share the national pain, but they appeared too blinded by dollars signs.

Democrats, who gained control of Congress after promising the voters that the economic needs of the middle class would be a priority, have an opportunity to show that the trust has not been misplaced.

The energy bill in Senate should be approved — even though President Bush will undoubtedly veto it.