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Shell's former CEO explains why we hate oil companies

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By Steven Mufson
Sunday, May 23, 2010

John Hofmeister, former president of Shell Oil, was never your typical oil executive. He wasn't a petroleum engineer. He had spent most of his career before Shell working at companies such as General Electric and Nortel. Relatively early in the debate, he said climate change was a problem the world had to address. And unlike most oil execs, he's showing a dash of introspection, writing a new book called "Why We Hate the Oil Companies," in which he denounces the "parochialism" of the industry as well as politicians' "hollow" promises of energy independence.

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Hofmeister runs the advocacy group Citizens for Affordable Energy, which he says has raised nearly $1 million from individuals, foundations and companies -- but not energy firms. Washington Post business reporter Steven Mufson spoke with Hofmeister about the BP oil spill, whether cheap energy is a constitutional right and why Congress will never fix our energy problems.

Excerpts:

Why do we hate oil companies?

The short answer is because the government has taught us to. Government's failure over many decades to make the difficult decisions and choices with respect to our energy future means they look for a scapegoat when things go wrong. The primary scapegoats they choose are the oil companies, whether about prices, environmental issues or supply issues; it's always the oil companies' fault.

Are the oil companies blameless?

The oil companies have earned the disfavor of government by A) choosing sides, preferring a particular party in general and B) maintaining a wall of silence, which ultimately comes back to hurt them.

How does the corporate culture of oil companies compare with that of other industries?

From an insider perspective, I never worked with more brilliant, committed people than inside the oil industry. From an external sense, I never worked with a more introverted culture. In my early career, working with General Electric for example, there was a requirement for senior GE folks to engage the community on an ongoing basis, because everybody in the community was a current or potential customer. On the retail side of the business of oil, it's the opposite.

In your book, you talk about some road trips you took to gas stations across the country. What was the most annoying moment?

I was visiting Erie, Pa., to just take the measure of Shell gas stations. I drove up to this particular station and noticed how filthy it was outside. And when I went inside, it was even filthier. There was trash all over the coffee space where people mix cream and sugar. There was trash on the checkout counter. And there was the operator wearing his Shell shirt, who, as I approached him, turned his back to me. I asked, "How's business?" He said, "It's none of your business, that's how's business." I asked, "How are you dealing with high gas prices?" He said, "Who are you?" I pulled out my business card and said, "I'm Shell's president." Then he started screaming at me: "You're taking food off my family's table. You're making billions, and I'm pinching nickels. You have no right to treat us the way you're treating us."

We ended up having a long conversation. . . . We didn't part friends, but we parted politely.


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