US House lawmakers seek antitrust probe of OPEC, other oil companies

A group of Democratic US House lawmakers asked the Justice Department on Tuesday to probe allegations of antitrust behavior among US oil producers and OPEC and said the two largest US oil companies have been conspiring to keep fuel prices high.

 

Nine House of Representatives Democrats, in a letter to Attorney General Merrick Garland, cited a complaint by the Federal Trade Commission (FTC) in May alleging the former CEO of Pioneer Resources engaged in an “outrageous scheme… to coordinate pricing between US oil companies and foreign producers.”

 

The letter, led by Jerrold Nadler, the top Democrat on the House Judiciary Committee, also cited the big profits earned last year by Exxon Mobil Corp and Chevron, the two largest US oil companies.

 

“Major oil producers appear to be colluding with each other and foreign cartelsto keep prices high, padding their profits at the expense of American consumers,” the lawmakers said.

 

“We urge you to use the full authority of the Department of Justice to investigate and, where necessary, prosecute this anticompetitive conduct,” the letter said.

 

On Exxon and Chevron, the lawmakers said the oil giants had apparently “been lining their own pockets while conspiring to keep prices high” instead of passing those profits through to consumers in the form of cheaper products.

 

Exxon said the FTC’s allegations are “entirely inconsistent with how we do business.”

 

Chevron did not immediately respond to a request for comment.

 

The Organization of the Petroleum Exporting Countries also did not immediately respond to a request for comment.

 

In addition to Nadler, the letter was signed by Henry Jackson, Pramila Jayapal and seven other Democrats.

 

Last month, the FTC approved Exxon Mobil’s $60 billion purchase of Pioneer Natural Resources, but barred former Pioneer CEO Scott Sheffield from Exxon’s board on allegations he attempted to collude with OPEC to raise oil prices.

 

Late last month, US Senate Majority Leader Chuck Schumer and 22 of his Democratic colleagues sent a similar letter to Garland.

 

Sheffield coordinated efforts with US shale oil producers to constrain their output and raise energy prices, the FTC said on May 2.

 

Sheffield, known for his long tenure and frank comments on industry output and spending, used his influence “to align oil production across the Permian Basin in West Texas and New Mexico with OPEC+,” a production group that includes Russia as well as OPEC members, the FTC said at the time.

 

First Published: Jun 05 2024 | 9:17 AM IST