US House Panel Approves 'NOPEC' Bill, Full House Vote Uncertain
A U.S. House of Representatives committee approved a bill on Thursday that would open up the Organization of the Petroleum Exporting Countries to antitrust lawsuits, but it was uncertain if the measure would be considered by the full chamber.
The House Judiciary Committee passed the bipartisan bill, known as the No Oil Producing and Exporting Cartels Act, or NOPEC, on a voice vote.
The legislation would change U.S. antitrust law to revoke the sovereign immunity that has long protected OPEC members from U.S. lawsuits. It allows the U.S. attorney general to sue the oil producers group or any of its members on grounds of collusion.
A similar bill was introduced in the Senate on Thursday by Republican Senator Chuck Grassley, a proponent of ethanol, a corn-based motor fuel.
Versions of the bill have appeared without success in Congress for the past 20 years. The committee also approved a version of the bill last year by voice vote, but it never reached the full House for a vote.
Momentum from Trump
The legislation has gained momentum as President Donald Trump, a Republican, has attacked OPEC, which includes U.S. ally Saudi Arabia, over past practices of holding back oil output to support oil prices.
Still, Trump has not voiced support of the NOPEC bill and has stressed the importance of the U.S. relationship with Saudi Arabia, even after the killing of journalist Jamal Khashoggi in the Saudi consulate in Istanbul last year.
Joe McMonigle, senior energy policy analyst at Hedgeye in Washington and an Energy Department official under former President George W. Bush, said odds were low the bill would advance during a time of relatively low oil prices.
"I don't see any kind of groundswell for it," McMonigle said. He said that even though Trump had not voiced support for NOPEC, Democrats, who now control the House, would be cautious to hand Trump something that could turn into a victory for him.
Don't expect Texas support
Lawmakers in Texas are also unlikely to support the bill, McMonigle added, as Motiva Enterprises LLC, a subsidiary of Saudi state oil company Saudi Aramco <IPO-ARMO.SE, operates a large refinery in the state.
U.S. oil prices fell more than 2.5 percent on Thursday to $52.64 a barrel on plentiful U.S. inventories and worries about global demand growth.
McMonigle said that if oil prices rose to $100 a barrel sometime in the future, "all bets are off" and support in Congress could rise.