U.S. Senate committee to consider bill pressuring OPEC oil group
Listen to this Article Now
A U.S. Senate committee is set to vote Thursday on a bill that could expose the OPEC oil producing countries and their partners to lawsuits for collusion on boosting crude prices, although similar moves have failed to pass through Congress in the past.
The No Oil Producing or Exporting Cartels (NOPEC) bill sponsored by Senators including Republican Chuck Grassley and Democrat Amy Klobuchar is slated to be considered during a meeting of the Senate Judiciary Committee that begins at 9:00 ET (1300 GMT)
Versions of the legislation have failed in Congress for more than 20 years. But lawmakers are increasingly worried about rising inflation driven in part by prices for U.S. gasoline, which briefly hit a record above $4.30 a gallon this spring.
“Now, given the soaring energy prices and the administration’s engagements with foreign oil producers, ensuring fair pricing and production practices has never been more important,” said Taylor Foy, a spokesperson for Grassley said last week.
The bill must pass the full Senate and House and be signed by President Joe Biden to become law.
Saudi Arabia and other OPEC producers have rebuffed requests by the United States and other consuming countries to boost oil production beyond gradual amounts, even as oil consumption recovers from the COVID-19 pandemic and Russian supply falls after its invasion of Ukraine.
OPEC+, a group comprising the Organization of the Petroleum Exporting Countries and partners including Russia, agreed on Thursday to stick to its existing plans for a modest output increase for another month.
The proposed legislation is intended to protect U.S. consumers and businesses from engineered spikes in the cost of gasoline, but some analysts warn that implementing it could also have some dangerous unintended consequences.
In 2019, Saudi Arabia threatened to sell oil in currencies other than the dollar if Washington passed NOPEC, a move that could undermine the dollar’s status as the world’s main reserve currency, reduce Washington’s clout in global trade and weaken its ability to enforce sanctions on nation states.