Bill allowing US to sue Opec draws fresh interest

NEW YORK/DUBAI: With oil prices hitting fresh four-year highs, longdormant proposals to allow the United States to sue Opec nations are getting a fresh look in Congress, though they were once considered a longshot to becoming law.

A US Senate subcommittee will hear today testimony on the so-called No Oil Producing and Exporting Cartels Act, or Nopec, which would revoke the sovereign immunity that has long shielded Organisation of the Petroleum Exporting Countries members from US legal action.

The bill would change US antitrust law to allow Opec producers to be sued for collusion; it would make it illegal to restrain oil or gas production or set those prices – removing sovereign immunity that US courts have ruled exists under current law.

Past US leaders have opposed the Nopec bill, but the possibility of its success may have increased due to President Donald Trump’s frequent criticism of Opec, and as some predict that Brent crude, the international benchmark, could reach US$100 (RM414) a barrel before long.

“Opec is a pet peeve for him,” said Joe McMonigle, senior energy policy analyst at Hedgeye Potomac Research. “Everybody thinks he could easily support Nopec.”

Saudi Arabia is lobbying the US government to prevent the bill’s passage, sources familiar with the matter said. Business groups and oil companies also oppose the bill, citing the possibility of retaliation from other countries.

Oil prices steadied near their highest since November 2014 yesterday as markets braced for tighter supply once US sanctions against Iran kick in next month.

Brent, the international crude oil benchmark, was flat at US$84.98 per barrel by 1344 GMT after reaching a new four-year high of US$85.45 in the previous session.

US West Texas Intermediate was up 11 cents at US$75.41 a barrel, having hit a four-year high of US$75.91 earlier in the session. – Reuters