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

Senate Majority Leader Chuck Schumer, D-N.Y., joined at left by Sen. Debbie Stabenow, D-Mich., speaks to reporters after Senate Republicans blocked a bipartisan security bill borders and immigration for the second time this year, at the Capitol in Washington, Thursday, May 23, 2024. (AP Photo/J. Scott Applewhite)

By MATTHEW DALY (Associated Press)

WASHINGTON — Senate Majority Leader Chuck Schumer and 22 other Democratic senators are calling 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 CEO of Pioneer Natural Resources, colluded with OPEC and OPEC+ to potentially raise crude oil prices. Sheffield retired from the company in 2016, but returned as CEO in 2019. After retiring in 2023, he continued to serve on its board of directors.

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

In a report, the FTC said collusion by Pioneer and others may have cost the average American household as much as $500 per car in annual increased 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 increased production costs due to the (coronavirus) pandemic or inflation,” the Democrats say. said.

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 businesses; Hardworking Americans end up paying the price through higher costs for 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,” Sheffield, but added: “The reality is that American 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 largest producer of crude oil in the world. “U.S. energy production has been a stabilizing force for consumers here and around the world, particularly in the face of OPEC supply cuts,” said institute spokeswoman Andrea Woods.

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 $1 billion in campaign donations in exchange for rolling back many of President Joe Biden's environmental and policy rules, including ending Democrats' freeze on liquefied natural gas exports. 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 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. Whitehouse and 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 Biden's energy policies, including the pause on LNG exports, restrictions on new oil and gas leasing on an oil reserve in Alaska and the decision to impose higher tariffs. high to companies to drill for oil and natural gas on federal lands.

Sen. John Barrasso, the top Republican on the Senate Energy Committee, said the Democratic president 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 Schumer, Whitehouse, Senate Commerce Committee Chairwoman Maria Cantwell of Washington state and Senate Judiciary Committee Chairman Dick Durbin of Illinois .