Secretary-General Mohammad Barkindo is urging OPEC members to lobby with the United States that a NOPEC bill against the organization would harm American interests, Reuters reported on Friday, quoting a letter Barkindo had written to the oil producers.
The United States has tried several times in the past to pass antitrust laws targeting OPEC’s market-fixing policies.
This week, the U.S. House Judiciary Committee passed the NOPEC bill, officially referred to as the No Oil Producing and Exporting Cartels (NOPEC) Act of 2021.
House Judiciary Committee Chairman Jerrold Nadler (D-NY) said before the vote at the committee that the NOPEC Act would be “expressly authorizing the Justice Department to pursue antitrust enforcement actions against OPEC members, should it choose to do so, and by ensuring that American courts have jurisdiction to hear such cases.”
OPEC is now encouraging its producers to reinforce diplomacy with the U.S. and stress that if the bill becomes law, it would hurt both U.S. interests and U.S. oil producers.
“It is essential that member countries reinforce diplomatic bilateral contacts with government officials in the U.S. ... and explain the disadvantages for the U.S. should the NOPEC bill become law,” Barkindo wrote in the letter Reuters had seen.
According to Barkindo, the disadvantages of a NOPEC bill for the United States could be “weakening the immunity principle at a global level, putting at risk U.S. interests overseas, and the protection for their personnel and assets.” In addition, a NOPEC law would raise the risk of more volatile oil prices, which directly hit U.S. oil producers, Barkindo’s letter says.
The U.S. Chamber of Commerce does not support a NOPEC Act, its Chief Policy Officer Neil Bradley said in a letter to the Judiciary Committee Chairman Nadler last week.
Although NOPEC “is intended to be limited to restraint of trade in oil, natural gas or petroleum products, the Committee should be wary of the precedent it could create. Once sovereign immunity has been eliminated for one action of a state or its agents, it can be eliminated for all state actions and the actions of agents of the state. Under reciprocal legal regimes the United States and its agents throughout the world could be tried before foreign courts – perhaps including the military – for any activity that the foreign state wishes to make an offense,” Bradley said.
By Tsvetana Paraskova for Oilprice.com
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