If the U.S. passes the NOPEC bill, a bill designed to pave the way for lawsuits against OPEC members for market manipulation, the oil market could face even more chaos. OPEC’s most influential energy ministers warned against passing the legislation, suggesting it could send oil prices soaring by 200% or 300%.
“The last thing we want is someone trying to hinder that system,” the UAE’s Energy Minister Suhail al-Mazrouei said at a conference in Abu Dhabi, referring to the system OPEC has had in place for decades to ensure supply to the market is adequate (adequate according to OPEC’s view).
“If you hinder that system, you need to watch what you’re asking for, because having a chaotic market you would see … a 200% or 300% increase in the prices that the world cannot handle,” al-Mazrouei said at a panel at the World Utilities Congress hosted by CNBC’s Dan Murphy.
According to Oil.com, as gasoline prices in America hit record highs, some lawmakers are looking to resurrect the NOPEC legislation that would allow the U.S. Attorney General to sue OPEC or its member states for antitrust behavior.
Forms of a NOPEC bill have been considered in Congress committees for nearly two decades, but they have never moved past committee discussions.
Now OPEC is warning of greater market chaos if NOPEC becomes law. But it’s not only OPEC that has been warning about the implications for America in setting a precedent to remove sovereign immunity. The most powerful oil lobby in the United States, the American Petroleum Institute (API), is also against such legislation, arguing it would bring unintended harm to America’s oil and gas industry and American interests in the world. So is the U.S. Chamber of Commerce, while the White House expressed “concerns” about the potential implications of such a law.
Last week, the U.S. Senate Judiciary Committee approved the so-called No Oil Producing and Exporting Cartels Act (NOPEC).
Forms of antitrust legislation aimed at OPEC were discussed at various times under Presidents George W. Bush and Barack Obama, but they both threatened to veto such legislation.
This time, it’s unclear if the bill would be moved for discussion at the Senate, or then to President Joe Biden’s desk, and it’s unclear whether he would sign such legislation into law.