Bush defends Exxon's record profit

NASHVILLE, Tenn. -- President Bush defended the huge profits of Exxon Mobil Corp. Wednesday, saying that they are simply the result of the marketplace and that consumers socked with soaring energy costs should not expect price breaks.

In an interview, Bush also addressed oil's future, offering a more ambitious hope than in his State of the Union speech for cutting imports from the volatile Mideast.

However, he said his oft-stated goal of a Palestinian state in the region cannot be realized if a Hamas-led government refuses to renounce its desire to destroy Israel.

Bush, a former Texas oilman, said of oil costs, "I think that basically the price is determined by the marketplace, and that's the way it should be."

"I believe in a relatively quick period of time, within my lifetime, we'll be able to reduce if not end dependence on Middle Eastern oil by this new technology" of converting corn, wood, grasses and other products into ethanol, he said.

In his address Tuesday night, Bush had set a goal of reducing the nation's Mideast oil imports by 75 percent by 2025.

On Monday, Exxon reported record profits of $10.71 billion for the fourth quarter and $36.13 billion for the year -- the largest of any U.S. company. While some politicians raised furious objections, Bush had a different reaction.

"There is a marketplace in American society," he said.

"There's also a responsibility for energy companies to continue to invest and improve the ways that the American people can get energy," he said.

"I would very much hope that Exxon would participate in the development of a pipeline out of Alaska, for example, in order to make sure there's more natural gas available for families and small-business owners so the economy will grow."

On other subjects:

With three years left in his second term, Bush declined to say what -- if any -- role he would take in the selection of a Republican candidate to succeed him in the 2008 presidential race. But he accepted the proposition that Secretary of State Condoleezza Rice would not be a contender.

"I think you need to take her at her word that she's not running," Bush said in a conversation on Air Force One as he flew to Tennessee for a speech.

Bush said it was too early to tell what path Hamas would choose in dealing with Israel.

Bush was asked about Iran in view of Iranian President Mahmoud Ahmadinejad's vow to resist the pressure of "bully countries" as European nations circulated a draft resolution urging that Tehran be brought before the U.N. Security Council for its nuclear activities.

"It looks like to me the process is headed toward the Security Council, and that if the Iranians would like to avoid that, they ought to work in good faith to get rid of their nuclear weapon ambitions," the president said.

Bush dismissed the idea of increasing fuel efficiency standards for cars, trucks and SUVs as a way of curbing foreign oil dependence.

He rejected calls from some Republicans for the White House to disclose all its contacts with disgraced lobbyist Jack Abramoff. Bush said there was an investigation of Abramoff's activities and "to the extent they ask for information, they'll get it."