I

106TH CONGRESS

2D SESSION H. R. 4732

To require certain actions with respect to the Organization of Petroleum

Exporting Countries (OPEC) or any other cartel engaged in oil price

fixing, production cutbacks, or other market-distorting practices.

IN THE HOUSE OF REPRESENTATIVES

JUNE 23, 2000

Mr. GILMAN introduced the following bill; which was referred to the Committee on International Relations, and in addition to the Committee on

Banking and Financial Services, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions

as fall within the jurisdiction of the committee concerned

A BILL

To require certain actions with respect to the Organization

of Petroleum Exporting Countries (OPEC) or any other

cartel engaged in oil price fixing, production cutbacks,

or other market-distorting practices.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘International Energy

5 Fair Pricing Act of 2000’’.

6 SEC. 2. FINDINGS.

7 The Congress finds the following:
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1 (1) The Organization of Petroleum Exporting

2 Countries (OPEC), in its capacity as an oil cartel,

3 has been a critical factor in withholding production

4 from the market and driving up oil prices approxi5 mately 300 percent from January 1999 to June

6 2000.

7 (2) Nationwide, gasoline prices have increased

8 approximately 60 cents a gallon since the beginning

9 of 1999 with crude oil prices increasing 48 cents

10 over this same time period.

11 (3) The Department of Energy’s weekly survey

12 showed the average cost of gasoline in the United

13 States increased 5 cents a gallon to $1.68 from the

14 second to the third week of June 2000, a record

15 high for a fourth week in a row.

16 (4) Price declines in the cost of oil in April

17 2000, following the March 2000 OPEC meetings,

18 have been reversed because OPEC output did not

19 meet global demand and supply conditions. When

20 OPEC members met in March 2000, quotas were

21 not set high enough for refiners around the world to

22 rebuild crude stocks depleted by winter heating de23 mand.

24 (5) Crude oil stocks in the United States are

25 only 31,000,000 barrels above the lowest operational
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1 inventories ever observed in recent times (the equiva2 lent of 2 days of refinery operations) and

3 20,000,000 barrels under the normal range for the

4 month of June.

5 (6) The United States needs to make a system6 atic review of its bilateral and multilateral policies

7 and those of all international organizations and

8 international financial institutions to ensure that

9 these policies are not directly or indirectly sup10 porting the oil price fixing activities, policies, and

11 programs of OPEC.

12 SEC. 3. POLICY OF THE UNITED STATES.

13 (a) POLICY WITH RESPECT TO INTERNATIONAL OR14 GANIZATIONS.—It shall be the policy of the United States

15 that the extent to which each international organization

16 supports, or otherwise recognizes, OPEC will be an impor17 tant determinant in the relationship between the United

18 States and this organization.

19 (b) POLICY WITH RESPECT TO INTERNATIONAL FI20 NANCIAL INSTITUTIONS.—It shall be the policy of the

21 United States that the extent to which each international

22 financial institution supports or otherwise recognizes

23 OPEC, will be an important determinant in the relation24 ship between the United States and the institution.
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1 (c) POLICY WITH RESPECT TO THE ENERGY AND

2 DEVELOPMENT ACTIVITIES.—The United States should

3 carefully review all the energy development projects and

4 programs administered by the United States Agency for

5 International Development in developing countries to en6 sure that these projects and programs do not indirectly

7 or inadvertently support the activities of OPEC.

8 SEC. 4. POLICY TOWARD THE INTERNATIONAL FINANCIAL

9 INSTITUTIONS.

10 (a) REPORT TO THE CONGRESS ON ACTIVITIES OF

11 THE INTERNATIONAL FINANCIAL INSTITUTIONS.—No

12 later than 90 days after the date of the enactment of this

13 Act, the President shall transmit to the Congress a report

14 that contains the following:

15 (1) A description of any loan, guarantee, or

16 technical assistance provided or to be provided by

17 any international financial institution that does or

18 would directly or indirectly support any activity or

19 program of OPEC or any other cartel, or any mem20 ber of OPEC or any other cartel, engaging in pro21 duction cutbacks or other market-distorting prac22 tices.

23 (2) A description of the energy sector loans of,

24 technical assistance provided by, and policies of each

25 international financial institution, and an analysis of
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1 the extent to which the loans, assistance, or policies

2 promote the complete dismantlement of international

3 oil price fixing arrangements and the development

4 of a market-based system for the exploration, pro5 duction, and marketing of petroleum resources.

6 (b) UNITED STATES POSITION IN INTERNATIONAL

7 FINANCIAL INSTITUTIONS.—The United States Executive

8 Directors at each international financial institution shall

9 use the voice, vote, and influence of the United States to

10 oppose the provision of any loan, guarantee, or technical

11 assistance by the institution that would directly or indi12 rectly support the activities and programs of OPEC or any

13 other cartel, or any member of OPEC or any other cartel,

14 engaging in production cutbacks or other market-dis15 torting practices.

16 SEC. 5. REPORT RELATING TO THE ORGANIZATION FOR

17 ECONOMIC COOPERATION AND DEVELOP18 MENT (OECD).

19 Not later than 90 days after the date of the enact20 ment of this Act, the President shall prepare and transmit

21 to Congress a report that—

22 (1) describes the efforts of the Organization for

23 Economic Cooperation and Development (OECD) to

24 review the market-distorting practices of inter25 national cartels, including OPEC, and recommends
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1 specific actions that the member countries of the

2 OECD can undertake to combat such practices; and

3 (2) describes actions to be taken by the United

4 States to ensure that the OECD expands upon its

5 activities and programs regarding the operation of

6 international cartels.

7 SEC. 6. AMENDMENT TO THE FOREIGN ASSISTANCE ACT OF

8 1961.

9 Section 106 of the Foreign Assistance Act of 1961

10 (22 U.S.C. 2151d) is amended by adding at the end the

11 following:

12 ‘‘(g)(1) In carrying out the activities under this chap13 ter, the President shall—

14 ‘‘(A) ensure that amounts made available to

15 carry out this chapter are not used to support, di16 rectly or indirectly, the programs, activities, and

17 policies of the Organization of Petroleum Exporting

18 Countries (OPEC), or any other cartel, or any mem19 ber of OPEC or any other cartel, if OPEC or such

20 other cartel engages in oil price fixing; and

21 ‘‘(B) certify annually to the appropriate con22 gressional committees that the requirement of sub23 paragraph (A) has been met for the prior fiscal year.

24 ‘‘(2) In this subsection—
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1 ‘‘(A) the term ‘appropriate congressional com2 mittees’ means—

3 ‘‘(i) the Committee on International Rela4 tions and the Committee on Banking and Fi5 nancial Services of the House of Representa6 tives; and

7 ‘‘(ii) the Committee on Foreign Relations

8 and the Committee on Banking, Housing, and

9 Urban Affairs of the Senate; and

10 ‘‘(B) the term ‘oil price fixing’ has the meaning

11 given such term in section 7(2) of the International

12 Energy Fair Pricing Act of 2000.’’.

13 SEC. 7. DEFINITIONS.

14 In this Act:

15 (1) INTERNATIONAL FINANCIAL INSTITU16 TION.—The term ‘‘international financial institu17 tion’’ has the meaning given in section 1701(c)(2) of

18 the International Financial Institutions Act.

19 (2) OIL PRICE FIXING.—The term ‘‘oil price

20 fixing’’ means participation in any agreement, ar21 rangement, or understanding with other counties

22 that are oil exporters to increase the price of oil or

23 natural gas by means of, inter alia, limiting oil or

24 gas production or establishing minimum prices for

25 oil or gas.
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1 (3) OPEC.—The term ‘‘OPEC’’ means the Or2 ganization of Petroleum Exporting Countries.

3 (4) PETROLEUM RESOURCES.—The term ‘‘pe4 troleum resources’’ includes petroleum and natural

5 gas resources.

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