Are oil companies honest?
In 1979, Thomas Ogle invented a new carburetor system working with steam power. He succeeded to make 200 miles with 8 liter of fuel. His system had a little celebrity and a lot of oil companies afraided for their profits tried to buy Ogle's invention. Ogle refused to sell it and tried to develop his invention by himself. At last, he sold his car system to an oil company. He had confidence in this company but they said his invention didn't work.
Two years later, Ogle was killed (because he built another car with steam power).
Oil companies are money-hungry and make all their possible to maximize their profits. Intern note in mid-80 highlighted that oil companies reduced their refining capacities to create a shortage situation and increase profits.
Oil companies seem to try their best to:
prevent from technological progresses to keep a high-level profit.
reduce refining capacities to create shortage situation and keep an expensive fuel price.
To sum up, are oil companies the biggest swindlers of twentieth century?
There are a ton of large energy companies. All it takes is one to come up with a viable alternative energy source. The one that does will make an absolute killing, more than significantly offsetting their loss of profits from the decline of oil. They all know this, which is why they all invest in R&D. The technology will get there one day and a high price of oil will make this day come sooner.
Your story about the steam-powered engine is likely bogus, or at the very least the technology wasn't anywhere near profitable. If it was you can bet there would be a company out there, not necessarily big oil, that would be selling it. If a large company is aware of a superior technology relevant to their business, there is simply no reason for it not to adopt it.
Big oil does attempt to limit competition and artificially raise the price of oil. However, this mostly revolves around using political connections to increase regulations that make it difficult for competitors, almost always smaller ones, to compete on a level playing field. They also use their clout to gain access to oil fields, or to get around regulations that their (smaller) competitors are subject to. They may even push for a foreign policy that causes instability in oil-producing regions, thereby driving up the price of oil.