U.S. Senate Probes Oil Producers for Alleged Price Collusion with OPEC
(Reuters) — The U.S. Senate budget committee on Thursday launched a probe of domestic oil producers about any efforts to illegally coordinate oil prices with the Organization of the Petroleum Exporting Countries, in the latest effort by Democratic lawmakers to pressure energy companies.
The producers the committee is probing include ExxonMobil, Chevron, ConocoPhillips, and 14 others. Those three major energy companies did not immediately respond to requests for comment. Two of the other big companies in the group, BP and Shell, declined to comment.
Interest among many Democratic lawmakers in possible collusion among oil companies with production groups spiked last month after the U.S. Federal Trade Commission (FTC) barred former Pioneer Natural Resources CEO Scott Sheffield from Exxon's board on allegations he attempted to collude with OPEC to raise oil prices. The FTC made the move as it approved Exxon's $60 billion purchase of Pioneer.
Sheffield has denied the FTC's allegations.
Senator Sheldon Whitehouse, a Democrat and the chairman of the Budget committee, called for the probe of the companies.
"Based on recent events involving Pioneer Natural Resources ... I am concerned about the possibility that oil and gas companies could be engaging in collusive, anti-competitive activities with OPEC+ that would raise crude oil prices, resulting in higher costs not only for American families, but also for the U.S. government when it acquires crude oil for the Strategic Petroleum Reserve," Whitehouse said in a statement.
OPEC+ is a production group that includes OPEC and Russia, that has agreed to cut production. The administration of President Joe Biden is slowly replenishing the SPR after it sold 180 million barrels from the reserve in 2022 in an attempt to keep fuel prices in check following Russia's invasion of Ukraine.
The American Petroleum Institute (API) industry group called Whitehouse's probe an "election year stunt."
API spokesperson Bethany Williams said: "This is yet another election-year stunt to distract from misguided policies as the administration continues to look to foreign producers to meet growing demand for affordable, reliable energy."
Biden, a Democrat, hopes to win reelection in November. Whitehouse, of Rhode Island and a top advocate for strong policies on curbing climate change, is running for a fourth term in the U.S. Senate.
Earlier this month a group of nine Democrats in the U.S. House of Representatives asked the Justice Department to probe allegations of antitrust behavior among U.S. oil producers and OPEC.
In May, U.S. Senate Majority Leader Chuck Schumer and 22 of his Democratic colleagues sent a similar letter to Attorney General Merrick Garland.
Whitehouse asked the companies to provide by July 12 any communications between them and members of the OPEC Secretariat and OPEC+ concerning oil output, crude oil prices and the relationship between the production and pricing of oil products from January 2020 to the present.
OPEC did not immediately respond to a request for comment.
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