This may be the worst possible time for oil and gas to have a bad public image

It's not often that a message from a break-out session at a financial service company's energy conference is dramatically illustrated within a few days. But it happened the week of May 19.

It's not often that a message from a break-out session at a financial service company's energy conference is dramatically illustrated within a few days. But it happened the week of May 19.

The May 20 oil and gas break-out session during the 2008 Deloitte Energy Conference focused on the public's perception of the industry. It's not good, panelists quickly agreed.

"There's an urgent and ongoing need to educate people about the fundamentals of energy, whether members of Congress or the general public," suggested James A. Slutz, acting principal deputy assistant US energy secretary.

Just how urgent and ongoing became obvious when five major oil company executives testified before the US Senate Judiciary Committee on May 21 and the House Judiciary Committee's antitrust task force on May 22.

Several federal lawmakers said they simply wanted answers. "I hear most from my constituents that gasoline prices are too high. They're looking for explanations and so am I," said Rep. Betty S. Sutton (D-Ohio) during the House committee's hearing.

Looking for respect

Oil and gas industry leaders have been aware of the problem for some time, American Petroleum Institute President Red Cavaney pointed out. "The industry is spending very huge resources in a public relations campaign to burnish its image. We don't expect people to love the oil industry. We'd like them to respect it as a reliable energy supplier," he said.

Several oil company chief executives started individual public education efforts 10 years ago, he said during the Deloitte conference session. But the real wake-up call came after Hurricanes Katrina and Rita in 2005 when several were called before Congress and accused of manipulating supplies and markets, Cavaney said.

API and its members have been working hard to make sure they are part of the growing US discussions on energy and the environment ever since, he continued. "We have seen some very modest changes in the conversation, but we still have a lot of work to do," he said.

'Politically disenfranchised'

But Jim Cox, a senior vice president and oil, gas and chemicals specialist at Hill & Knowlton, said that a survey by that firm found that 87% of the respondents ranked the oil industry as the worst, and 86% said that they don't trust it to solve the nation's energy problems.

"There's an enormous amount of information the oil industry has that should be part of the national discussion, but it's politically disenfranchised. It has been a sporadic communicator. It has to engage motorists and environmentalists. It needs to own the issue and not tolerate having a bad reputation," he maintained.

Pharmaceutical manufacturers have developed their own programs to help the needy and elderly pay for prescriptions, while gas and electric utilities have similar efforts, Cox noted.

Cavaney said that he and several other industry representatives recently visited an area where oil and gas is not one of the major businesses. Local residents and business leaders stayed for an hour beyond the meeting's scheduled time to ask questions, he said.

"The climate may be starting to slowly change. Voters are smarter than many politicians think," API's president observed.

Contact Nick Snow at nicks@pennwell.com

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