Familiar Back and Forth With Oil Executives

Executives J. Stephen Simon of Exxon Mobil, from left, John D. Hofmeister of Shell, Peter J. Robertson of Chevron, John E. Lowe of ConocoPhillips and Robert A. Malone of BP America appeared before a House committee. (By Chip Somodevilla -- Getty Images)

"Raising taxes on oil and gas production to subsidize alternatives will likely lead to less energy production, not more," said J. Stephen Simon, senior vice president at Exxon Mobil. (The House bill would not change tax rates on oil and gas production but would prevent the oil companies from sharing a cut in income tax rates given in 2004 to all U.S. firms deemed to be manufacturers.)

Markey quarreled with Simon over Exxon Mobil's lack of investment in alternative energy projects. Simon said Exxon Mobil was giving Stanford University $100 million over 10 years to research "breakthrough" technologies.

"OPEC has us over a barrel and you're saying you're going to study the issue," Markey retorted. Markey defended the House energy-tax package, which is awaiting action in the Senate.

"You can't have it both ways, Mr. Simon," Markey said. "You can't be nickel-and-diming renewables at Exxon Mobil and simultaneously fighting our efforts to move over the resources to renewables to help this country break its dependence on foreign oil."

The executives said they were focused on meeting rising U.S. demand for petroleum products. "With all the work on alternative energy, the United States will consume more natural gas, oil and coal in 2030 than it does today," said Robert A. Malone, head of BP America.

Robertson said Chevron had spent $73 billion from 2002 to 2007. "We're working darn hard. We have a challenge to meet," he said. "So life is not easy."

Cleaver cited the companies' high share prices and said it didn't sound like much of a struggle.

"I didn't say it was a struggle," Robertson said. "I said we're working hard to solve a problem."

Across town before the hearing, Jeroen van der Meer, chief executive of Royal Dutch Shell, got a more polite hearing at the Center for Strategic and International Studies. Van der Meer said high prices were "more about psychology and tensions" and "the lack of spare capacity" than about supplies. He noted there were no ships waiting for loadings and no lines at gasoline stations. "Supplies are okay," he said.

He warned, however, that energy demand would double by 2050 as the world's population increases by half and standards of living rise. "The easy oil and easy gas will not be sufficient," van der Meer said.