The Senate Judiciary Committee approved by voice vote Thursday a bill that seeks to tame natural gas and crude oil prices by strengthening antitrust enforcement and bolstering competition in the energy industry.
The measure (S 2557) would subject energy companies to prosecution under the Clayton Act if they withhold oil and gas in an effort to raise prices; calls for a joint federal-state task force to be created to investigate information-sharing between companies to determine if the practice has encouraged anti-competitive pricing; and requires the Department of Justice and Federal Trade Commission to study whether future consolidations in the energy industry need closer scrutiny.
The legislation is sponsored by Sen. Arlen Specter (R-PA), chairman of the Senate Judiciary Committee, and Sen. Herb Kohl (D-WI). Co-sponsors include Sens. Mike DeWine (R-OH), Richard Durbin (D-IL), Dianne Feinstein (D-CA) and Patrick Leahy of Vermont, the ranking Democrat on the Senate judiciary panel.
"With the high fuel prices the American consumer is enduring, it is time for an examination of what oil and gas industry consolidations have done to prices," Specter said. "We have allowed too many companies to merge together and reduce competition. This legislation will help address the excessive concentration of power in the oil industry." Specter reported that more than 2,600 mergers have occurred in the U.S. petroleum industry since the 1990s.
The GOP-led Congress "should pass this bill immediately instead of waiting until the price at the pump skyrockets any higher," Leahy said. It could not be immediately learned when the Senate would take up the bill on the floor.
The committee action follows a March 14 hearing that explored the connection between the stepped-up consolidation in the oil and gas industry and the run-up in energy prices. CEOs of the leading oil and gas companies, appearing before the Senate Judiciary panel, expressed their opposition to the bill, saying that they believed existing antitrust laws were adequate (see Daily GPI, March 15).
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