The U.S. Senate approved a plan on Tuesday that would enable the federal government to sue the Organization of Petroleum Exporting Countries, commonly known as OPEC. for price manipulation.
The White House has threatened to veto the measure as opponents fear the members of the 12 country energy cartel could retaliate by cutting gas supplies. The precarious debate of OPEC versus “NOPEC” had already started. The U.S. House of Representatives last month voted unanimously to approve the “No Oil Producing and Exporting Cartels Act” of 2007. With surging gas prices and accusations of price manipulation coming from as far a field as the International Energy Agency, U.S. Congress members have called for America to insulate itself against foreign oil producers. If the bill becomes law, it would give the Justice Department the authority to sue oil cartels – a measure aimed squarely at the 12-member OPEC group. The bill's opponents admitted that it was a popular move but warned that the OPEC nations who source about a third of the world's oil could retaliate and dry up the taps. “OPEC producers could just decide not to sell oil to us any longer. They would suffer the loss of some profits but our entire economy could come to a grinding halt,” said Senator Pete Domenici of New Mexico. The body had approved a similar measure in 2005 but it was dropped on the grounds that OPEC's members were immune to lawsuits because their decisions were “acts of state” on behalf of foreign governments. The United States is the world's biggest crude oil consumer and relies on imports for about 60% of its daily needs, largely by OPEC countries.