Lord Browne said his firm was working on a pioneering reduction technology, but argued that companies would need the lure of subsidies to take up on the technique, called "carbon capture", which experts claim can reduce greenhouse gases significantly.

The call is likely to anger motorists, who are facing increasing petrol costs on the forecourt, and MPs, many of whom have been urging the Government to slap a windfall tax on the oil companies which have seen profits soar on the escalating prices of oil, which has risen by about 40 per cent a barrel this year.

In many areas of Scotland, such as the Borders and Highlands, the price of a litre of petrol has broken through the 90 pence barrier.

"If carbon capture and storage is to succeed, we are going to need subsidies to encourage companies to take up this technology," Lord Brown said.

Carbon capture is a method of collecting carbon dioxide gas emanating from power stations or oil and gas fields.

It is then compressed and buried deep underground. However, it is a more expensive way to generate electricity - on a par with electricity from renewable sources.

BP is jointly planning to build a new Scottish power station with Scottish and Southern Energy aimed at producing electricity by less polluting means, with emissions buried under the North Sea.

Lord Browne said BP would make only a "very moderate" return from its investments in carbon capture.

He said that given the investment needed and the higher costs involved, a subsidy was needed "in order to be able to compete".

Lord Browne justified his claim by saying that other renewable energy projects, such as wind, attract a subsidy.

The call puts the Government on the back foot, since it has signed up to the Kyoto agreement - which came into force last year - to reduce greenhouse gases.

Last week, at the G8 meeting of world leaders, Prime Minister Tony Blair also claimed he had won ground on emissions reduction, something Lord Browne, writing in the Financial Times, described "a great piece of progress".

He also claimed that BP had effectively taken the lead among the oil majors in cleaning up its act, stating that when it began embracing the environment agenda about eight years ago, rivals viewed them as "heretics".