{"database": "press", "table": "releases", "rows": [["https://www.hassan.senate.gov/news/press-releases/senators-hassan-shaheen-stand-up-to-big-oils-anti-competitive-proposed-mergers", "Senators Hassan, Shaheen Stand Up to Big Oil\u2019s Anti-Competitive Proposed Mergers", "2023-11-03", "2023", "2023-11", "Democrat", "Senate", "NH", "Margaret Wood Hassan", "H001076", "www.hassan.senate.gov", "hassan", "https://www.hassan.senate.gov/news/press-releases", "scraper", "WASHINGTON \u2013 U.S. Senators Maggie Hassan and Jeanne Shaheen joined Senate colleagues in urging the Federal Trade Commission (FTC) to closely evaluate two massive, newly announced proposed mergers by the top-two biggest oil companies in the United States, Exxon and Chevron. ExxonMobil\u2019s proposed $60 billion acquisition of Pioneer Natural Resources and Chevron\u2019s proposed $53 billion acquisition of Hess Corporation are two of the largest petroleum deals in American history and two of the biggest petroleum deals of the 21st century. These proposed acquisitions could be disastrous for Americans consumers \u2013 greatly reducing competition and driving up gas prices at the pump.\n\nThe Senators wrote, \u201cExxon\u2019s and Chevron\u2019s operations downstream would enable them to redirect Pioneer\u2019s and Hess\u2019s crude supply to themselves, away from (and possibly to the detriment of) their midstream competitors. These new market dynamics could result in price hikes for midstream customers, and such added costs are often passed downstream to retail customers, including drivers at gas stations.\u201d\n\n\u201cIn our view, the FTC should not have approved the ExxonMobil merger in 1999, which created the largest corporate successor of Standard Oil\u2019s original illegal monopoly, or the merger between Chevron and Texaco in 2001,\u201d the Senators said. \u201cLax enforcement during that period resulted in market manipulation, unstable supply, and price hikes for Americans. We must avoid similar mistakes going forward. It is incumbent upon the FTC to closely review the Exxon-Pioneer and Chevron-Hess acquisitions and take appropriate action should such reviews uncover any possible anticompetitive effects enabled by the acquisitions.\u201d\n\nFull text of the letter is below and available here.\n\n***\n\nDear Chair Khan:\n\nWe write regarding our concerns about two blockbuster oil-and-gas deals announced in October: ExxonMobil\u2019s (Exxon) proposed $60 billion acquisition of Pioneer Natural Resources (Pioneer) and Chevron\u2019s proposed $53 billion acquisition of Hess Corporation (Hess) \u2013 two of the largest oil-and-gas deals of the 21st century. 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. At the regional level, the deals threaten to harm small operators and suppress wages. The Federal Trade Commission (FTC) must carefully consider all of the possible anticompetitive harms that these acquisitions present. Should the FTC determine that these mergers would violate antitrust law, we urge you to oppose them.\n\nThis Industry Is Already Too Concentrated, and Americans Are Already Paying the Price.\n\nIn the 1990s, over 2,600 mergers occurred throughout all segments of the U.S. petroleum industry. Between 1990 and 2001, the number of major U.S. energy companies plunged by more than half, dropping from 19 to 9, due to merger activity. Most notably, Exxon merged with Mobil in 1999; Chevron merged with Texaco in 2001 (after Chevron had already acquired Gulf Oil and Texaco had already bought Getty Oil in the 1980s).\n\nSuch consolidation enabled better industry coordination, and the remaining firms were well aware that they were members of an oligopoly with a \u201csmall number of companies involved, all of whom share[d] a motivation to recoup costs and not undermine the market.\u201d For example, according to internal Mobil and BP documents, the majors understood that \u201c[f]looding the market and depressing margins on the base volume\u201d they marketed was unprofitable. Likewise, they knew that directing their individual supplies into, or away from, particular regions of the country enabled them to achieve \u201cprice uplift scenarios\u201d and to \u201cleverage up\u201d prices. The Government Accountability Office found that five specific mergers from that time period \u2013 Marathon-Ashland, Shell-Texaco I (Equilon), BP-Amoco, MAP-UDS, and Exxon-Mobil \u2013 led to wholesale gasoline price increases ranging from 0.39 to 5.00 cents per gallon. Of those five, the price increase due to the Exxon-Mobil merger was the greatest.\n\nAfter these huge mergers took place, the majors\u2019 upstream operations were skewed to the detriment of consumers. Studies at the time demonstrated that spending on drilling for new oil supplies by the merged giants fell significantly compared to the drilling budgets before their mergers. Strangely enough, the majors cut back on upstream production at a time when crude prices were sky high and exploration costs had fallen by more than half, \u201cone of the biggest potential disconnects between supply and demand in the 150-year history of the oil business.\u201d These anticompetitive tactics resulted in a fragile supply for the nation where isolated mishaps at refineries or broken pipelines caused enormous price spikes for consumers (as took place in 2000, 2001, 2002, and 2005) \u2013 all of which financially benefited the oligopolists, providing them no incentive to stabilize national supply.\n\nConsolidation in midstream operations hurt Americans consumers, as well. In 1993, the largest five oil refiners had a collective share of about one-third of the American market, and the largest ten controlled 55.6 percent. By 2005, due to the wave of mergers, the top five controlled 55 percent of the market, and the largest ten had 81.4 percent. This increase in concentration enabled the largest players to manipulate the industry by withholding supply in order to drive up prices, and since most of the firms were also vertically integrated, they benefited from higher prices at the retail level, as well.\n\nSimilar market dynamics exist today. The oil-and-gas industry is still dominated by a handful of corporate giants, led by the top-two players Exxon and Chevron. Any further consolidation could harm American consumers. This is especially true given the inelastic demand for gas products; those who drive to work rarely have substitutes for gas, so as prices rise, people do not purchase less gas. In April 2020, as the COVID-19 pandemic began, retail gasoline prices averaged $1.84. Prices steadily rose for two years, hitting a historic height of $4.93 in June 2022, and remain relatively high today at $3.84. Meanwhile, Exxon and Chevron posted their own historic heights in 2022: $56 billion in profits for Exxon and $36.5 billion for Chevron. They were not alone; Big Oil corporations collectively earned an industry high of nearly $200 billion last year. President Biden rightfully called for the FTC to investigate the oil industry for price gouging since such surges cannot be explained away by increased production costs from the pandemic or inflation, especially in light of these firms\u2019 astronomical profits.\n\nThe Deals Could Harm Competition and Lead to Even Higher Prices for Americans.\n\nExxon is the largest oil-and-gas corporation in the United States, operating up and down the supply chain and across the entire industry. Its acquisition target, Pioneer, is an upstream petroleum operator drilling in Texas\u2019s Permian Basin. Pioneer owns more drilling acreage than any other producer in the Permian where Exxon is also a top producer. A merged Exxon-Pioneer could produce a staggering 1.2 million barrels per day \u2013 more than twice the amount of the next competitor. Accordingly, this deal would enable the new Exxon to dominate the Permian \u2013 the most prolific oil-and-gas field in the world and America\u2019s most important.\n\nChevron is America\u2019s 2nd largest oil-and-gas firm with integrated operations rivaling Exxon\u2019s. Hess is one of the largest producers in North Dakota\u2019s Bakken Shale, the deepwater Gulf of Mexico, and offshore Guyana.\n\nSupporters of the deals have argued that the global market for oil and gas is so enormous that dominant firms in the relevant basins would not have enough supply to restrict capacity or raise prices in any meaningful way. Focusing only on the global market is improper. Even if these energy firms represent a small fraction of the global petroleum market, the question before the FTC is whether these proposed transactions are likely to harm American consumers. Thus, the FTC must consider how Exxon\u2019s or Chevron\u2019s vertically integrated operations may harm American competition in spite of the global market. For example, Exxon owns extensive midstream operations in the Permian Basin, meaning Exxon controls storage, refining, and transportation for a significant amount of capacity in the region where it will acquire Pioneer\u2019s drilling operations. Exxon has an extensive pipeline system that transfers crude supply from the Permian to the Texas Gulf Coast. Recently, Exxon expanded its refinery operations on the Texas Gulf Coast by an additional capacity of 250,000 barrels per day and announced plans to ramp up its exporting operations on the Texas Gulf Coast, suggesting that Exxon-Pioneer intends to move significantly more oil and gas out of the United States than the two companies exported separately. Exxon\u2019s CEO Darren Woods put it more bluntly in 2020: \u201cThese projects are export machines, generating products that high-growth nations need to support larger populations with higher standards of living. Those overseas markets are the motivation behind our investments. The supply is here; the demand is there. We want to keep connecting those dots.\u201d This export strategy \u2013 in the nation\u2019s most important oil-and-gas field, no less \u2013 could reduce the amount of their capacity ultimately available to American consumers and thereby increase prices throughout the energy supply chain, including at the gas pump. Furthermore, as we described above, the major energy firms already have a history of artificially reducing supply and increasing prices following rounds of consolidation.\n\nIf this \u201cconsolidation trend in the US\u201d continues accelerating, competing exploration-and-production companies will find it increasingly difficult to operate without Exxon\u2019s and Chevron\u2019s networks, which creates new abilities and incentives for Exxon and Chevron to engage in anticompetitive tactics. Exxon\u2019s and Chevron\u2019s operations downstream would enable them to redirect Pioneer\u2019s and Hess\u2019s crude supply to themselves, away from (and possibly to the detriment of) their midstream competitors. These new market dynamics could result in price hikes for midstream customers, and such added costs are often passed downstream to retail customers, including drivers at gas stations.\n\nWe also urge you to investigate how an Exxon-Pioneer merger might impact local operators in the Permian as well as oilfield employees such as geologists and engineers. Potential anticompetitive harms at any level of the supply chain and in any market merit consideration by the FTC.\n\nThe FTC Must Protect Americans from Big Oil.\n\nThese deals also demonstrate how corporate consolidation can frustrate self-governing democracy. At a time when Americans overwhelmingly support governmental efforts to clean up the environment and protect our nation from climate disasters, Exxon and Chevron are doubling down on fossil-fuel production. The proposed transactions would augment these corporations\u2019 outsized political power, further enabling them to spend millions on lobbyists against climate legislation, litigation to slash environmental rules, and misinformation disputing scientific facts about climate change.\n\nUnder President Biden, the FTC has been willing to stand up to Big Oil. Just last year, the FTC required an energy private-equity fund to divest its entire crude-oil business in Utah before allowing a similar transaction to close, expressing concerns that the deal would lead to higher prices for refiners and consumers at the pump.\n\nThe fight against Big Oil is not new. When the Justice Department took on Standard Oil in the early twentieth century, the Supreme Court protected competition by breaking up Standard Oil into 43 different firms. Eventually, the global industry reorganized into seven dominant global players, including five prominent American companies \u2013 three of which (Standard Oil of California, Gulf Oil, and Texaco) combined into today\u2019s Chevron, and two of which were Standard Oil of New Jersey (now known as Exxon) and Standard Oil of New York (now known as Mobil). In our view, the FTC should not have approved the ExxonMobil merger in 1999, which created the largest corporate successor of Standard Oil\u2019s original illegal monopoly, or the merger between Chevron and Texaco in 2001. Lax enforcement during that period resulted in market manipulation, unstable supply, and price hikes for Americans. We must avoid similar mistakes going forward. It is incumbent upon the FTC to closely review the Exxon-Pioneer and Chevron-Hess acquisitions and take appropriate action should such reviews uncover any possible anticompetitive effects enabled by the acquisitions.\n\nIf anything, the FTC should be investigating the past anticompetitive mergers of Big Oil conglomerates like ExxonMobil and Chevron to determine whether these energy giants should be broken up once again.\n\nWe appreciate your attention to these serious matters.\n\n###", 1, "2026-03-30T01:40:41Z", "2026-04-08T01:01:09Z"]], "columns": ["url", "title", "date", "year", "month", "party", "chamber", "state", "member_name", "bioguide_id", "domain", "scraper", "source", "date_source", "text", "has_text", "collected_at", "updated_at"], "primary_keys": ["url"], "primary_key_values": ["https://www.hassan.senate.gov/news/press-releases/senators-hassan-shaheen-stand-up-to-big-oils-anti-competitive-proposed-mergers"], "units": {}, "query_ms": 0.735417939722538, "source": "dwillis/congress-press", "source_url": "https://github.com/dwillis/congress-press", "license": "MIT", "license_url": "https://github.com/dwillis/congress-press/blob/main/LICENSE"}