PREVIEW-BP to face isolation from peers at Congress hearings

* Oil company execs face Congress over oil spill Tuesday

* Companies may try to distance themselves from BP

* BP CEO Tony Hayward appears before House panel Thursday

By Ayesha Rascoe

WASHINGTON, June 14 (BestGrowthStock) – Top competitors are
expected to distance themselves from BP Plc (BP.L: ) on Tuesday
as normally clubby oil industry executives gather for a Capitol
Hill grilling on the worst oil spill in U.S. history.

With the mid-term congressional elections looming, U.S.
lawmakers summoned top executives from Big Oil — including BP
— in what is likely to be a heated showdown on the safety of
drilling in the deep waters off America’s coasts.

The top executives from Exxon Mobil (XOM.N: ), Chevron
(CVX.N: ), ConocoPhillips (COP.N: ) and Royal Dutch Shell (RDSa.L: ),
can be expected to turn on BP, whose survival as an independent
company is increasingly being questioned.

Industry officials are expected to loudly vouch for safety
at their own operations and their superior abilities to handle
an incident akin to the BP disaster that has caused millions of
gallons of oil to spew into the Gulf since April.

“They have to explain how they’re different from BP. Not
only in operations, but in cleanup,” said one oil industry
source familiar with what the company executives will express
at the hearing.

BP America head Lamar McKay will be on the hotseat on
Tuesday but on Thursday BP chief executive Tony Hayward will
make his first appearance at a congressional hearing since the
Deepwater Horizon accident.

Both hearings present a significant risk to BP and to the
future of U.S offshore drilling, as lawmakers begin to consider
legislative options to address the massive Gulf oil spill and
to possibly increase the penalties companies will face.

With spilled oil ravaging the Gulf Coast and now hitting
Florida, the fallout from the accident is growing, putting the
Obama administration under pressure to take action.

President Barack Obama could call for energy legislation
and new oil safety provisions when he addresses the nation on
Tuesday. The next day he will meet BP Chairman Carl-Henric
Svanberg and press him to set up an independently managed fund
to pay damage claims.

At the hearing, lawmakers and investors will be looking for
any sign from oil executives that BP may have cut corners or
not followed generally accepted industry practices.

“If they say that, it would definitely be damaging for BP,”
said Evgeny Solovyov, analyst at Societe Generale in London

With BP facing ballooning damages, the company’s shares
have fallen more than 40 percent on concerns it may not be able
survive the Gulf disaster. Its future may hinge on legislative
and regulatory decisions going forward.

“When the company goes before Congress, it’s going to be
sort of like when Goldman Sachs went before Congress a few
weeks ago,” said Michael Sheldon, chief market strategist at
RDM Financial in Westport, Connecticut.

“It’s going to be full of drama; it’s going to be ugly for
BP officials and there’s probably not going to be a lot gained
from the experience,” he added.

Senate leaders have called on BP to make a $20 billion
initial deposit into a fund to pay liability claims. Some
lawmakers have also called on BP to suspend its dividend.

All of the oil company heads will undoubtedly face intense
questioning about their ability to prevent or contain similar
rig accidents at the Tuesday hearing hosted by a House Energy
and Commerce subcommittee.

The panel’s chairman, Massachusetts Democrat Edward Markey,
is an especially tough critic of so called Big Oil.

Although BP is taking most of the heat now, the whole
industry has felt the effects of the Gulf oil spill, with a six
month moratorium on deepwater offshore drilling and tighter
safety rules.

One company has been in this spot before. ExxonMobil’s
Valdez oil spill in Alaska some 20 years ago was the focus of
the anti-oil drilling movement, until BP came along.

Exxon Chairman Rex Tillerson and the other executives are
likely to caution lawmakers not to make hasty decisions on
changing regulatory oversight for the offshore industry, while
making the case their practices are safe.

Stock Market Research Tools

(Additional reporting by Tom Bergin, Leah Schnurr and Tom
Doggett; Editing by Russell Blinch and Cynthia Osterman)

PREVIEW-BP to face isolation from peers at Congress hearings