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Late Breaking News |
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| Date: August 11, 1998 3:15 pm Contact:Essential Action/Consumer Project on Technology James Love of Consumer Project on Technology or Robert Weissman of Essential Action, 202-387-8030 |
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Latest News Releases
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Consumer Groups Criticize BP/Amoco Merger | ||
| WASHINGTON - August 11 - James Love, director of the Consumer Project on
Technology, and Robert Weissman, co-director of Essential Action, today issued the
following statement: We fear the BP-Amoco merger, announced today, will hurt consumers by raising prices, spur a round of anticompetitive mergers in the oil industry and dangerous concentrate economic and political power. We are asking U.S. antitrust authorities to create a forum for public comment on the issue of concentration in the petroleum and mining industries, and to solicit views on issues such as mergers and joint ventures. Today's announcement regarding British Petroleum and AMOCO suggests we may be faced with a series of mergers, as is now occurring in the telecommunications industry. In the telephone industry, the early mergers were approved without much thought as to how each new merger created an environment where the next merger was more likely. We think it is appropriate to consider in a pro-active way the larger picture, and how public policy objectives of efficiency and consumer welfare are best served -- either by competition among the many or collusion among the few. Insufficient scrutiny of this merger will soon lead to other mergers and a policy crisis in the petroleum sector, given the lack of policy guidance or a well-developed theory regarding concentration that will adequately protect consumers. Consumers currently benefit from low prices for petroleum, a consequence, in part, of the degree of competition in the industry. We do not believe giant mergers like these will hurt competition, and hurt consumers. It is also appropriate for antitrust authorities to consider the political consequences of concentrated economic power. In the petroleum industry, for example, BP has broken from the industry's tooth-and-nails opposition to any effort to address global warming. This sort of industry division becomes increasingly less likely as the number of competitors shrinks. The immediate issue here is BP's willingness at least to consider modest greenhouse gas reduction measures. The broader concern is that a diminishing number of competitors will tend to lead to more lockstep, and more politically potent, industry positions on public policy questions. ------ The Consumer Project on Technology and Essential Action are both Ralph Nader-founded organizations. -0- |
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