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Trump official slams cartels as U.S. lawmakers push anti-OPEC bill

Reuters  |  WASHINGTON 

By Gardner

WASHINGTON (Reuters) - said on Friday that U.S. national security depends on affordable energy, and slammed cartels when asked if would support a bill targeting the OPEC group's

"The is firmly committed to open, fair and competitive markets for global trade," said the official, who spoke on condition of anonymity. "We do not support market-distorting behavior, including cartels."

The of Representatives' Judiciary Committee on Thursday unanimously passed the No Oil Producing and Exporting Cartels, or NOPEC, bill. Steny Hoyer, who has supported NOPEC in the past, was reviewing the bill, an said, but there was no indication whether a vote in the full would be scheduled.

The legislation would change American to revoke the sovereign immunity that has long protected OPEC members from U.S. lawsuits. It allows the general to sue the group, any of its members, and countries it works with, on grounds of collusion.

A similar bill was introduced in the on Thursday by Senators Chuck Grassley, a Republican backer of the corn-based motor fuel ethanol, and Amy Klobuchar, a Democrat who is expected to announce on Sunday whether she is running for in 2020.

Senator of has opposed NOPEC in the past. Other lawmakers were also unlikely to support the bill as Motiva Enterprises LLC, a subsidiary of Saudi company Saudi Aramco, operates a in the state, a said.

The Vienna-based Organization of the Petroleum Exporting Countries, which includes the world's top crude exporter Saudi Arabia, says it is not a cartel but rather a group.

Trump has criticized the group for cutting supplies and urged it to produce more to lower global But the has taken no action on Saudi Arabia, a major buyer of U.S. weapons, even after the killing of in the last year.

The bill has appeared in in various forms over the last 20 years, and today's are low compared to 2008, when the bill passed the House. Oil traded in fell 6 cents to $52.58 per barrel on Friday and was down about 4.9 percent for the week, the steepest decline this year, pulled down by worries about a global economic slowdown.

The senior official's comments were the furthest the has gone in commenting on the bill, which also passed the last year, but did not come up for a vote in the full chamber.

"Access to affordable and reliable underpins global economic growth and U.S. national security," the added.

Trump supported NOPEC in his book "Time to Get Tough" published in 2011 before he became president, but he has not publicly commented on the bill while in office.

NO LONGER HELD HOSTAGE

Last summer, OPEC cooperated with non-OPEC producer to boost output before Trump reimposed sanctions on from Iran, Saudi Arabia's archrival. But OPEC's output fell in January by the largest amount in two years as its Gulf members over-delivered on a supply cutting plan to boost prices.

The American Petroleum Institute, the top lobbying group for U.S. oil and gas drilling, has opposed the NOPEC bill, saying it could expose diplomatic, business and military interests to retaliation.

API said in an interview the bill was "populist" and the group would work with the House and leadership to tell them that the U.S. shale oil revolution, which has helped make the country the world's top oil producer, has helped combat OPEC.

"We are no longer held hostage by the in Vienna," Sommers said.

said in a research note that the appetite for advancing the bill was likely subdued while were low. But if it did pass, the legislation would threaten the sustainability of coordinated supply actions by OPEC, and OPEC plus Russia, and add more volatility to the market.

Another said the bill's future depends on the "The higher the price of crude goes, the higher the odds of NOPEC. It's just that simple," said Robert McNally, president of Rapidan Energy, a consultancy.

(Reporting by Gardner; additional reporting by Valerie Volcovici, and in New York; editing by and Jonathan Oatis)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

First Published: Sat, February 09 2019. 02:53 IST
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