Schumer, Democrats urge Justice Department to pursue allegations of collusion, price-fixing in oil industry

Senate Majority Leader Chuck Schumer and 22 other Democratic senators call on the Justice Department to “use every tool” at its disposal to prevent and prosecute allegations of collusion and price-fixing in the oil industry .

In a letter Thursday to Attorney General Merrick Garland and other officials, Democrats said a recent Federal Trade Commission investigation into a high-profile merger found evidence of price-fixing by executives of the oil sector that has led to rising energy costs for American families and businesses.

The FTC said earlier this month that Scott Sheffield, the former chief executive of Pioneer Natural Resources, colluded with OPEC and OPEC+ to potentially raise crude oil prices. Mr. Sheffield retired from the company in 2016, but returned as CEO in 2019. After retiring again in 2023, he continued to serve on the board of directors.

The FTC cleared Exxon Mobil Corp.'s $60 billion deal on May 2. to buy Pioneer, but barred Mr. Sheffield from joining the new company's board of directors. Pioneer, headquartered in Dallas, said it disagreed with the allegations but would not prevent the merger, which was announced in 2023, from being completed.

In a report, the FTC said collusion by Pioneer and others may have cost the average American household as much as $500 per vehicle in increased annual fuel costs, an amount Democrats called an “unwelcome tax.” and particularly burdensome for low-income families.” » Meanwhile, Exxon Mobil and other major oil companies collectively made more than $300 billion in profits over the past two years, “a rise that many market experts say cannot be explained by 'increase in production costs due to the (coronavirus) pandemic or inflation'. » said the Democrats.

The letter calls on the Justice Department to launch an industry-wide investigation into possible violations of the Sherman Antitrust Act. He points out that “the alleged collusion of major oil companies with OPEC constitutes a national security concern that helps countries that seek to weaken the United States,” including Russia and Iran.

“Corporate malfeasance must be combatted, otherwise it will proliferate,” the letter said. “These alleged violations don’t just enrich companies; Hardworking Americans end up paying the price through higher costs of gasoline, fuel, and related consumer products. The DOJ must protect consumers, small businesses, and the public from collusion in the oil market.

A spokeswoman for the American Petroleum Institute, the oil and gas industry's largest lobbying group, said officials “do not know the details of the FTC's allegations against any individual,” Mr. Sheffield, but added: “The reality is that U.S. producers have answered the call to meet growing energy demand, despite a wave of inflationary policies from this administration that threaten our long-term energy security.

The United States is the world's largest producer of crude oil, which the Petroleum Institute calls a “stabilizing force” for American consumers.

White House Press Secretary Karine Jean-Pierre declined to comment on the allegations against Pioneer, but said President Joe Biden “has made clear that any illegal collusion between big corporations is unacceptable and defrauds families who work hard, including if it raises prices to the price level.” pump.”

Mr. Biden “will continue to call on large corporations with record profits – including Big Oil – to reduce costs for consumers,” she added.

The letter from Senate Democrats was the latest in a series of partisan actions targeting the oil industry.

Democrats last week launched a separate investigation into what they say oil executives may have promised or been promised at an April dinner with former President Donald Trump, who reportedly asked executives a billion dollars in campaign donations in exchange for a reversal of Biden's scores. environmental rules and policies, including ending the Democratic-imposed freeze on new liquefied natural gas export terminals. Mr. Trump, the presumptive Republican presidential nominee, also reportedly said he would preserve or improve tax benefits for the oil and gas industry in what Democrats called a “politics-for-money deal.”

Trump campaign spokeswoman Karoline Leavitt said in a statement Thursday that Mr. Trump “is supported by people who share his vision of American energy dominance to protect our national security and lower the cost of living.” for all Americans.”

Separately, Democratic Sen. Sheldon Whitehouse of Rhode Island and Democratic Rep. Jamie Raskin of Maryland formally asked the Justice Department to investigate whether Exxon, Chevron and other oil companies misled the public for decades on the climate effects of burning fossil fuels. Mr. Whitehouse and Mr. Raskin led a multi-year investigation that revealed what they described as “damning new documents that expose the fossil fuel industry's ongoing efforts to mislead the public and block climate action” .

Republicans, meanwhile, have attacked Mr. Biden's energy policies, including the pause on new LNG export proposals, restrictions on new oil and gas leasing on an Alaska oil reserve and the decision to impose higher fees on companies to drill for oil and natural resources. gas on federal lands.

Wyoming Sen. John Barrasso, the top Republican on the Senate Energy Committee, said Mr. Biden was “doing everything he can to make it economically impossible to produce energy on federal lands.”

The letter released Thursday was signed by 23 Democrats, including Mr. Schumer, Mr. Whitehouse, Senate Commerce Committee Chairman Maria Cantwell of Washington state, and Senate Judiciary Committee Chairman Dick Durbin, of Illinois.