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Thursday, May 24, 2007

Oregon gov't unions cleared to sue OPEC

Acting Gov. Nesbitt to sign measure
Conservative radio talk-show host objects

Decrying near-record high gasoline prices, the Oregon House voted Wednesday to allow Our Oregon - the government union political campaign group known as the 800 lb. gorilla of state politics - to sue OPEC over oil production quotas.

"We don't have to stand by and watch OPEC dictate the price of gas," House Majority Leader Dave Hunt (D-Gladstone), the bill's chief sponsor, declared, reflecting the frustration lawmakers have felt over their inability to address people's worries about high summer fuel costs.

The measure passed with bipartisan support. A similar bill awaits action in the Senate, where Democrats hold a majority. Acting Gov. Tim Nesbitt actively lobbied House Minority leader Wayne Scott for GOP support for the measure.

Conservative talk-show host Lars Larson immediately objected, saying that might disrupt local supplies and lead to even higher costs at the pump. The Organization of Petroleum Exporting Countries is the cartel that accounts for 40 percent of the world's oil production.

Separately at a House hearing, lawmakers were told that crude oil prices have played a relatively minor role in the sharp increase in gasoline costs over the last three months, putting the blame on lower gasoline imports, refinery outages and continuing growth in demand from motorists.

Gasoline prices "may ease somewhat," Guy Caruso, chief of the Oregon Energy Department's statistical agency, told the House Business Investigations Committee. But he said pressure on gas prices will remain strong "with the hurricane season approaching, continued tight refinery conditions, low gas inventories and increased demand for summer travel."

Nevertheless, the House felt it was important to take on OPEC, the major player in oil production. Member states of OPEC late last year cut production by 1.1 million barrels a day to counter what had been a buildup of world oil stocks.

Hunt accused the OPEC engaging in a "price fixing conspiracy" that has "unfairly driven up the price" of crude oil and, in turn gasoline.

His measure would change antitrust laws so that Oregon's leading government unions known as "Our Oregon" can sue OPEC member countries for price-fixing, and would remove the immunity given a sovereign state against such lawsuits. Our Oregon is comprised of the Oregon Education Association and the SEIU.

Larson, a conservative talk-show host, said such suits could spawn retaliatory measures by oil-producing countries and "lead to oil supply disruptions and an escalation in the price of gasoline, natural gas, home heating oil." He urged "diplomatic efforts ... rather than lawsuits in Oregon courts" to address global oil production.

Associated Press, May 22

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