Exxon CEO sees economic risk from high oil price

HOUSTON – The head of Exxon Mobil, the largest US oil company, said on Monday that rising energy prices could damage the nascent US economic recovery and misguided energy policy could worsen the situation.

‘It does concern me that energy prices not become an obstacle to the economy recovery,’ Exxon Chief Executive Officer Rex Tillerson told reporters after a speech to a Houston civic group.’That’s why I’m concerned about some of the policy decisions that are made in this country that could lead to higher prices,’ he said.US policies leading to tax increases or higher royalty rates for deepwater exploration will discourage companies from investing in exploration projects and result in higher prices, he said.Crude oil prices climbed to an 18-month high above US$87 per barrel earlier this month, before slipping back to about about US$81,50 on Monday in trading on the New York Mercantile Exchange.Demand for gasoline begins to suffer when US retail prices move above US$3 per gallon, Tillerson said.Data released on April 11 showed the average price of gasoline in the United States was US$2,85 per gallon.’Once you do get north of the US$3 to $3,50 (per gallon) range, people do begin to alter their behaviour,’ the executive said.Tillerson said discussions on energy policy in the United States should focus on securing supplies, rather than weaning the nation off foreign-produced energy sources.IRAQ, GHANATillerson said that Exxon, the Iraqi government and other big oil companies are still in discussions over a massive water-injection project aimed at boosting production in southern oilfields in that country.’There are going to be enormous water requirements to support the production from the fields,’ Tillerson told reporters.’From the beginning, the Iraqi government has talked about what is going to be the most efficient way to do it. It will be something that we will all have to talk about further,’ he said, adding that Exxon has not yet been tapped to lead the project. Tillerson also declined to comment on the company’s negotiations to buy a stake in Ghana’s Jubilee field in Ghana from privately-held Kosmos Energy. Last month, he said the negotiations were ongoing.’I really can’t comment on Ghana right now,’ Tillerson told reporters.- Nampa-Reuters

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