US Democrats propose bill to hold oil companies accountable for dealings with OPEC

WASHINGTON:

Democratic US lawmakers on Wednesday introduced a bill to hold energy companies accountable if federal regulators find they colluded with the Organization of the Petroleum Exporting Countries to raise oil prices.

The bill, introduced by Sen. Edward Markey and Rep. Nanette Barragan, says that if any energy company is found by the Federal Trade Commission to have colluded with OPEC, it would no longer be eligible for new oil and gas leases on federal lands and waters.

What is the background?

In May, the FTC accused Pioneer Natural Resources CEO Scott Sheffield of exchanging hundreds of messages with OPEC officials to artificially inflate oil prices. The US antitrust regulator approved Exxon Mobil’s $60 billion purchase of Pioneer, but barred Sheffield from Exxon’s board.

Sheffield denied the FTC’s allegations. Exxon, which has since bought Pioneer, did not immediately respond to a request for comment on the bill. But Exxon said it has submitted more than 1.1 million documents and other information and data to the FTC and that the agency has not raised concerns about its business practices.

Why is it important?

While the bill has little chance of passing with Republicans controlling the House of Representatives and Democrats holding only a slim majority in the Senate, it shows some lawmakers are putting pressure on oil companies.

Last month, the US Senate Budget Committee launched an investigation of domestic producers into any efforts to coordinate oil prices with OPEC, in a move the American Petroleum Institute, a lobby group, called an “election stunt.”

Markey’s bill was also supported by about 11 other left-leaning Democrats in the House, including Alexandria Ocasio-Cortz and Raul Grijalva.

Key quote

Markey said in a statement that the bill is a “first step toward ensuring that Big Oil has big consequences when they profit off the backs of hard-working Americans.”