Oil boss accused of driving up petrol prices by colluding with rivals

A leading US energy executive has been barred from the board of ExxonMobil over allegations he colluded with Opec+ to raise oil prices.

Scott Sheffield, the former chief executive of Pioneer Natural Resources, coordinated with US shale oil producers to restrict output and raise energy prices, the US Federal Trade Commission (FTC) alleged.

The FTC also claimed he used that position of influence to “align oil production across the Permian Basin in West Texas and New Mexico with Opec+”, the organisation dominated by Middle Eastern countries and Russia.

FTC said the collaboration between Opec and American rivals would have decreased oil production and pushed up fuel prices.

The US watchdog made the claims as it gave the go-ahead for ExxonMobil’s $60bn (£47.9bn) purchase of Pioneer but effectively blocked Mr Sheffield from further involvement.

Kyle Mach, deputy director of the FTC’s Bureau of Competition, told Reuters: “Mr. Sheffield’s past conduct makes it crystal clear that he should be nowhere near Exxon’s boardroom.”

Mr Sheffield and Pioneer reject the allegations.

In a statement, they said the regulator had “a fundamental misunderstanding of the US and global oil markets and misreads the nature and intent of Mr. Sheffield’s actions”.

A spokesman added: “During Mr Sheffield’s career, it was neither the intent nor an effect of Mr Sheffield’s communications to circumvent the laws and principles protecting market competition.

“On the contrary, Mr. Sheffield focused on legitimate topics such as investor feedback on independent oil and gas company growth and capital reinvestment frameworks; unfair foreign practices that threatened to undermine US energy security; and, through dialogue with government officials, the need to sustain a resilient, competitive and economically vibrant oil and gas industry in the United States.”

When asked whether the FTC was referring the collusion allegations to the US Department of Justice for further investigation, a spokesman said only: “The FTC has a responsibility to refer potentially criminal behaviour and takes that obligation very seriously.”

Exxon said it would not add Mr Sheffield to its board. A spokesman said the lengthy FTC investigation “raised no concerns with our business practices”.

Pioneer is a large independent oil and gas exploration and production company, headquartered in Dallas, Texas, with operations in the US.

The Pioneer acquisition will make Exxon the largest oil and gas producer in the biggest shale basin in the US, doubling its output there to more than 1.3 million barrels of oil equivalent per day.

Opec, the Organisation of the Petroleum Exporting Countries, was founded in 1960 by Saudi Arabia, Iran, Iraq, Kuwait and Venezuela to strip control of global oil production from the UK and the British companies that then dominated.

Members control an estimated 79pc of the world’s oil reserves, and the ability to influence prices by controlling production has showered huge wealth on Opec members, particularly in the Middle East.

This has prompted other countries to join and now has 12 members, as well as a wider network called Opec+ launched in 2016 that involves another 10 oil-producing states, including Russia.