24 May 2007 - 18:29
  • News Code: 105479

MOSCOW, WASHINGTON -- Russia said yesterday the US House of Representatives broke international law when voting on Tuesday to approve a bill to allow the US government to sue the Organisation of Petroleum Exporting Countries (Opec) and similar organisations for price manipulations.

"This decision is a violation of the norms of international law," Vesti 24 state channel quoted a statement by Russia"s foreign ministry as saying. When contacted by Reuters, the ministry declined to comment.

 

The White House threatened to veto the bill saying it could raise gasoline prices.

 

With average US pump prices at an all-time, inflation-adjusted high of $3.22 a gallon, the House voted 345-72 to approve the "No Oil Producing and Exporting Cartels Act of 2007," or "Nopec."

 

The bill would revoke the sovereign immunity Opec members currently enjoy from US legal action and allow the Justice Department to sue them in US courts. "For years now, Opec"s price-fixing conspiracy - and that"s what I call it - a conspiracy - has unfairly driven up the costs of imported crude oil to satisfy the greed of oil exporters," Representative John Conyers of Michigan, chairman of the House Judiciary Committee and the bill"s House sponsor.

 

The United States is the world"s biggest crude oil consumer and relies on imports for about 60 per cent of its daily needs. A large slice of US imports come from non-Opec members like Canada and Mexico, but Opec members like Venezuela, Nigeria and Saudi Arabia supply significant quantities.

 

Unclear

 

A similar version of the bill, sponsored by Democrat Kerb Kohl of Wisconsin and Republican Arlen Specter of Pennsylvania, passed the Senate Judiciary Committee last month. But it is unclear if the full Senate will act on the bill.

 

The White House said the bill could spur crude oil and gasoline prices higher, and that foreign nations would likely retaliate by limiting US access to global oil supply.

 

The White House has been hesitant to chide Opec - source of more than a third of the world"s oil - even as US crude oil futures prices flirted with the $70 a barrel mark.

 

Refinery problems in the US have drawn down gasoline stocks ahead of peak summer demand, pushing pump prices up to levels that, when adjusted for inflation, were last reached in the early 1980s during the Iran-Iraq war.

 

If the current "Nopec" bill is sent to President George W. Bush to be signed into law, "his senior advisers would recommend that he veto the bill," the White House said.

 

"This bill has the potential to lead to oil supply disruptions and an escalation in the price of gasoline, natural gas, home heating oil, and other sources of energy," it said.

 

If the bill becomes law, it would give the Justice Department the authority to sue oil groups, and the measure is aimed squarely at the 12-member Opec group.

 

A labour group sued Opec in 1978 under the Sherman Antitrust Act, but a US appeals court rejected the case in 1981.

 

PIN/REUTERS

News Code 105479

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