The American
Among Democrats, it is widely accepted that George Bush and Dick Cheney are in the tank for Big Oil. Yet some of the leading players in the U.S. energy business can’t wait for them to leave office.
Last week, I was invited to a luncheon. There were several tables. There were no name cards or reserved seats. I picked a table and sat down. A few seconds later, the spot to my left was taken by the CEO of one of America’s biggest integrated oil companies. (Since this was a casual meeting and there were no ground rules laid out, I will not name the executive or his company.) I introduced myself to him, and to the other men seated at the table.
After talking broadly about energy issues, I asked the CEO a fairly routine question: what’s the hardest part of your job? He didn’t waste a moment before responding that his toughest challenge involves risk assessment. The largest international oil companies are increasingly being shut out of the resource chase. About 90 percent of the world’s oil and gas reserves are controlled by state-owned or state-run energy firms. This is making life ever more difficult for the international investor-owned oil companies. Given that they have access to such a small slice of the world’s available energy resources, these companies are being forced to make multibillion-dollar bets on ventures that entail huge geologic and political risks.
Sure, they could go to Venezuela or Iran to launch major projects; but if they did so, they would face the prospect of having their assets or profits seized by the government. Therefore, global oil companies must either drill in deep offshore waters or gamble that political conditions in oil-rich autocracies will improve. As the CEO explained to me, Big Oil companies must invest billions in risky projects if they are to have any hope of “moving the needle”—that is, any hope of adding a substantial amount of new production to their inventory.
Our discussion led inevitably to politics and the 2008 election. The CEO told me that the last eight years have been terrible for American oil firms hoping to get concessions from countries that sit atop massive oil and gas reserves. “We get shut out simply because we are from the U.S.” he said, adding that the deterioration of America’s global image during the Bush years has been terrible for his company. He shook his head while talking, and then said bluntly: “Our foreign policy has been a disaster.”
Over the past few months, I’ve heard similar statements from other high-ranking people in the U.S. energy business. Their comments are stunning. For decades, the GOP and the oil and gas industry have been in virtual lockstep. Conservative Republicans in particular have been able to count on unquestioned support from Big Oil. With few exceptions, there were no prominent oil men who backed the Democratic Party. (Coastal Corporation founder Oscar Wyatt, who recently finished a one-year federal prison sentence for conspiring to make illegal payments to obtain Iraqi oil, is an obvious exception.)
Now it seems that a significant number of energy executives have turned against President Bush’s foreign policy and are eager for a new administration to take power. I didn’t ask the Big Oil CEO how he will be voting on November 4, but my strong hunch is that he will not be casting a ballot for John McCain.
Original text here: http://www.american.com/archive/2008/october-10-08/is-big-oil-for-obama
