Bill allowing US to sue Opec for inflating oil prices clears key hurdle

Legislation that would allow the US government to sue Opec for inflating oil prices cleared a key hurdle in the new session of Congress.

The House Judiciary Committee, now led by Democrats, advanced the “No Oil Producing and Exporting Cartels Act" Thursday. That sets the bipartisan "NOPEC" bill, which would subject the cartel to possible antitrust action by the Department of Justice, up for a possible House vote. A similar bill targeting Opec was introduced in the Senate on Thursday.

Opec’s members “deliberately collude to limit crude oil production as a means of fixing prices, unfairly driving up the price of crude oil," House Judiciary Committee Chairman Jerrold Nadler said before voting in favour of the legislation. The law would amend the Sherman Antitrust Act of 1890, the law used more than a century ago to break up the oil empire of John Rockefeller.

Various iterations of the bill have been proposed in the past, and former presidents have threatened to use their veto power to scupper the legislation. But President Donald Trump could be more amenable, given his frequent twitter attacks accusing the group of keeping oil prices artificially high.

“I’m not going to predict it will get passed and enacted into law, but I think its prospects are pretty good,” said Seth Bloom, former general counsel of the Senate Antitrust Subcommittee. “OPEC doesn’t have too many friends right now and the legislation may likely have a friend in the White House given Trump has written favourably about it in the past."

US Assistant Attorney General Makan Delrahim told members of a House subcommittee in December the administration “continues to study” the legislation.

“If Opec members conducted the same manipulation in the United States that they practice in Vienna, they could be prosecuted,” said Robbie Diamond, who heads up Securing America’s Future Energy. “Their actions have a profound impact on US consumers, businesses and our military, and our government can no longer allow that.”

Bloomberg