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Senate panel OKs plan to sue OPEC
By Chris Baltimore


The government would be able to sue the OPEC oil cartel for price fixing under legislation approved by a Senate panel on Thursday, less than a week before the cartel's most influential official visits Washington.

The bill passed by the Senate Judiciary Committee would revoke the sovereign immunity cartel members currently enjoy from U.S. legal action and allow the Justice Department to sue them in U.S. courts.

With Saudi Oil Minister Ali al-Naimi scheduled for a high-profile visit with Bush administration officials next week, the Senate plan would allow the U.S. attorney general to sue oil producing cartels if they try to limit production or set prices.

The so-called "NOPEC" provision must be approved by the full Congress and President Bush before taking effect. The White House quietly opposed a similar measure last year and has not yet weighed in on the latest version.

Saudi Arabia is the biggest producer in the Organization of Petroleum Exporting Countries, which pumps about a third of the world's crude oil, and Naimi is its de-facto front-man.

OPEC has been pumping near full-tilt in the face of record crude oil prices above $70 a barrel, and U.S. crude oil inventories have swelled to near 8-year highs.

OPEC's moves to control the amount of oil pumped by its members amounts to a "flagrant violation of anti-trust laws," said Sen. Mike DeWine (news, bio, voting record), Ohio Republican. "If companies in the United States were doing what OPEC is doing today they could be hauled into court."

During the debate over last year's energy bill, the Senate approved a similar provision, but it was pulled before the legislation became law. Some lawmakers say the proposal will not curb Americans' seemingly insatiable appetite for oil.

Without cutting rising U.S. energy demand, "What we are doing here is complaining about price-fixing by the drug dealers instead of confronting the addiction itself," said Sen. Richard Durbin (news, bio, voting record), Illinois Democrat.

Sen. Frank Lautenberg (news, bio, voting record), New Jersey Democrat, on Thursday wrote to Energy Secretary Sam Bodman and said he should stop "coddling" OPEC members and challenge the cartel before the World Trade Organization.

An Energy Department spokesman said Bodman routinely talks with producer nations including OPEC members to "encourage them to maintain the markets with adequate supply."

Bodman has plans to meet next week with Naimi as well as energy officials from Canada and Mexico, the spokesman said.

Lautenberg criticized Bodman for recently praising OPEC members for their ability to produce crude oil at a time when oil prices are near record highs.

"Americans suffering at the pump want the Bush administration to break up the OPEC cartel, not encourage it," Lautenberg wrote in the letter.




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