Opposing Efforts By Natural Gas Exporting Countries To Establish A Cartel

Floor Speech

OPPOSING EFFORTS BY NATURAL GAS EXPORTING COUNTRIES TO ESTABLISH A CARTEL -- (House of Representatives - July 11, 2007)

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Ms. ROS-LEHTINEN. Madam Speaker, I yield myself such time as I may consume.

Madam Speaker, for several decades, the world's supply of petroleum has been held hostage to the whims of the Organization of Petroleum Exporting Countries, also known as OPEC.

Over the past decades, OPEC has manipulated production to bring about enormous price increases. It has repeatedly manufactured energy crises and imposed embargoes against individual countries for political purposes, including right here in the United States. As a result of its policies, several of its members, and especially their elites, have grown enormously wealthy at the expense of the global economy, which has suffered severe disruption and slower growth.

Envying the success of this greedy model, many of the world's exporters of natural gas have begun taking steps to create a similar cartel in natural gas which has been termed as a ``gas OPEC.''

There are some in the West who dismiss the feasibility of a new OPEC for natural gas, citing differences in the structure of the oil and gas industries. However, Madam Speaker, the leaders of many of these gas-exporting countries do not share those doubts, and several have been publicly enthusiastic about the prospects of this new project.

In January of this year, the supreme leader of Iran, Ayatollah Khamenei, proposed that Russia and Iran cooperate to establish a cartel for natural gas, prompting the President of Russia, Vladimir Putin, to state his great interest in this project. And Venezuelan strongman Hugo Chavez has announced his eager support for the proposed cartel, which he describes as an expansion of his efforts to establish a similar structure in our own Western Hemisphere.

These are not empty statements. As the gas-exporting countries formed in Doha on April 9, 2007, a committee chaired by the Russian Government was established to study the proposals for greater coordination of policies, including pricing that participants confirmed would be necessary for the creation of such a cartel.

The threat is not only economic, but strategic. Officials from Iran have made clear their interest in using this gas OPEC as an instrument for political purposes. Russia has repeatedly demonstrated its willingness to use its role as a supplier of oil and gas to exert political pressure on other countries, such as Georgia, Ukraine and Belarus, among others.

NATO officials have warned of the danger of Europe's increasing dependence on Russian energy. But plans by the Europeans to diversify their sources of supply with countries such as Algeria have been called into question as Moscow has actively courted these to secure greater coordination of policies, including pricing.

Beyond Europe, U.S. allies, such as Japan and South Korea, are heavily dependent on imported natural gas. Countries such as China and India are rapidly increasing their reliance on foreign suppliers.

Currently, the United States is largely self-sufficient in natural gas. However, we are projected to greatly increase our usage over the next decades, which could produce a growing reliance on world supply.

If we are to prevent the rise of this new threat, the United States must make clear to these governments who are contemplating the establishment of this new organization that we will regard the establishment of a natural gas cartel as prejudicial to our Nation's security and global security.

We must also develop a joint strategy with our allies and all countries that are importers of natural gas, including by diversifying sources and access to international markets, such as pipelines.

As we proceed, Madam Speaker, we must keep in mind that several gas-exporting countries, such as Canada, Trinidad and Qatar, are friends of the United States. We must seek to enlist their assistance in stopping this menace before it becomes a reality that, once established, may be with us forever.

The creation of a ``gas OPEC'' world constitutes a major new threat to the security and to the economic well-being of the United States, our allies and the world. We must not stand back and let yet another global extortion racket be established. I strongly urge my colleagues to support this resolution.

Madam Speaker, I reserve the balance of my time.

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