US Senator Schumer urges FTC to probe Exxon, Chevron mega-deals
01/11/2023 11:35
Nov 1 (Reuters) -
U.S. Senate Majority Leader Charles Schumer on Wednesday
urged the U.S. Federal Trade Commission to consider possible
anti-competitive harms stemming from recent multi-billion dollar
acquisitions by oil and gas giants Exxon Mobil XOM.N and
Chevron Corp CVX.N .
Earlier this month, Exxon proposed to buy Pioneer
Natural Resources PXD.N for $60 billion and Chevron
agreed
to acquire Hess HES.N for $53 billion.
The Democratic Senate leader said in a letter that the
two of the largest oil and gas deals of this century are "likely
to harm competition."
The recent oil deals are a financial flex by U.S. oil
and gas companies that have kept investing in fossil fuels as
European rivals turned their attention to renewable fuels.
Chevron and Exxon have accumulated huge profits from
strong energy prices and demand since Russia's invasion of
Ukraine.
"By allowing Exxon and Chevron to further integrate
their extensive operations into important oil-and-gas fields,
these deals are likely to harm competition, risking increased
consumer prices and reduced output throughout the United
States," Schumer said in his letter.
The oil industry last went through an era of
major consolidation
in the late 1990s when Exxon, Shell SHEL.L , BP BP.L and
France's TotalEnergies TTEF.PA merged with rivals to create
huge integrated companies. The acquisitions followed a collapse
in oil prices that weakened many companies.
"If anything, the FTC should be investigating the past
anti-competitive mergers of Big Oil conglomerates like Exxon
Mobil and Chevron to determine whether these energy giants
should be broken up once again," Schumer added.
Several other Democrats also signed the letter.
(Reporting by Tanay Dhumal and Arunima Kumar in Bengaluru)
((Tanay.Dhumal@thomsonreuters.com; Twitter: https://twitter.com/TanayDhumal;))