The Federal Trade Commission has alleged that the founder and former CEO of a prominent American oil producer engaged in collusion with OPEC and its allies to artificially inflate oil prices. The FTC claims that the CEO, who retired in December 2023, exchanged numerous text messages and held discussions with OPEC officials regarding pricing, production, and market dynamics.
According to the complaint, the CEO used various communication channels, including WhatsApp, in-person meetings, and public statements, to coordinate oil production in the Permian Basin in Texas with that of OPEC and OPEC+. This alleged collusion aimed to benefit the oil companies involved while potentially harming US households and businesses.
Unlike OPEC nations, where oil production decisions are typically coordinated, US oil production is meant to be determined by market forces rather than collusion among major players.
The FTC recently approved the sale of the CEO's company to ExxonMobil for $60 billion, with the condition that the CEO is prohibited from joining Exxon's board or serving as an advisor. The FTC emphasized that the CEO's past conduct raised concerns about potential anticompetitive behavior and unfair pricing practices.
Regulators highlighted that the CEO openly advocated for coordinated output reductions between US oil producers and OPEC, both publicly and in private conversations with OPEC representatives. The FTC indicated that it takes the possibility of criminal charges seriously and is considering further actions in response to the alleged collusion.
The case underscores the importance of maintaining fair competition in the oil industry and ensuring that market forces dictate production levels rather than coordinated efforts that could harm consumers. The FTC's investigation into the matter reflects its commitment to upholding antitrust laws and protecting the interests of American consumers.
