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Wed, Jun 09, 2004 - Page 12 News List

Exxon chief dispels myth of energy independence in US

AP , WASHINGTON

The idea of American energy independence is a myth and the US must maintain "constructive relationships" with oil-producing countries for its own prosperity, the head of petroleum giant Exxon Mobil Corp said.

"We do not have the resource base to be energy independent," Exxon Mobil chairman Lee Raymond said Monday in a speech in which he outlined some of what he called the "hard truths" about global energy markets.

Raymond, who runs the world's largest publicly traded oil company, said that while other countries, including Russia, will play a growing role in supplying oil to the world, the Middle East will remain the center of supply because it holds as much as half of the world's oil reserves.

"We simply cannot avoid significant reliance on oil and gas from the Middle East because the world's supply pool [of oil] is highly dependent upon the Middle East," Raymond said in a speech at the Woodrow Wilson International Center for Scholars.

The fact that the US and the rest of the world will have to depend increasingly for its oil and also for natural gas from Middle East, "is not a matter of ideology or politics," he said. "It is simply inevitable."

Raymond scoffed at suggestions -- heard commonly among politicians in Washington -- of energy independence.

"We periodically hear calls for US energy independence as if this were a real option," he said. "The fact is, the United States is a part of the world energy market and we must participate and compete in that market."

At a time when relations with some major oil producers such as Saudi Arabia and Venezuela are strained, Raymond said the US must work to "maintain appropriate and constructive relationships with oil-rich countries in the future. They will be very important for our prosperity and our security."

Exxon Mobil earned a record US$21.5 billion last year, nearly double the previous year, and also reported record earnings during the first quarter of this year as crude oil and gasoline prices soared.

Raymond predicted that fossil fuels -- coal, oil and natural gas -- will continue to provide most of the energy for many decades.

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