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A Price-fixing Scandal Bigger Than Libor?: How the Oil Companies have us over a barrel
The London offices of Shell, BP, Statoil and Platts, the worlds leading oil price reporting agency, were raided yesterday by European Commission inspectors, investigating allegations of collusion in price-fixing over the past 11 years.
After last years Libor scandal, these new allegations of price-fixing look set to be a further damning indictment (if ever that were needed) of capitalism and the unfettered greed of its corporations.
If the allegations are true, then it again shows how prices are based NOT on true cost, but on an arbitrary figure dreamed-up to give as much money to a selfish, spineless, avaricious few.
The price people pay for oil is based on a benchmark which is calculated by price reporting agencies based on data received from firms such as oil companies, banks and hedge funds, which all trade oil on a daily basis. It is these submissions which the EC suspect are possibly fraudulent.
A spokesman for the European Commission said:
The commission has concerns that companies may have colluded in reporting distorted prices to a price reporting agency to manipulate the published prices for a number of oil and biofuel products.
Officials carried out unannounced inspections at the premises of several companies active in and providing services to crude oil, refined oil products and biofuels sectors.
Even small distortions of assessed prices may have a huge impact on the prices of crude oil, refined oil products and biofuels purchases purchases and sales, potentially harming final consumers.
The price fixing of fuel just doesnt hit driverseverything that is dependent on road haulage is directed affected by such underhand collusionfood prices, heating, public transport costsall are increased and the costs will always hit the poorest worst.
According to the Guardian, Lord Oakeshott, former Liberal Democrat Treasury spokesman, said:
the alleged rigging of oil prices was as serious as rigging Libor which led to banks being fined hundreds of millions of pounds.
He demanded to know why the UK authorities had not taken action earlier and said he would ask questions of the British regulator in Parliament. Why have we had to wait for Brussels to find out if British oil giants are ripping off British consumers? he said. The price of energy ripples right through our economy and really matters to every business and families.
source: Dangerous Minds | A Price-fixing Scandal Bigger Than Libor?: How the Oil Companies have us over a barrel
BP, Shell and Statoil investigated over suspected oil price manipulation
BP, Shell and Statoil are under investigation by the European Commission over suspected collusion to distort the oil price.
The EC said it had concerns that several companies may have manipulated the oil price benchmark in violation of EU antitrust rules, potentially having a huge impact on oil and petrol prices.
Shares in the oil giants fell in early trading on Wednesday after European regulators began an investigation into whether the companies may have manipulated the price of oil for more than a decade. Shell was down 1.7pc, while BP fell 0.2pc.
The Commission said that on Tuesday it had raided the offices of several companies active in and providing services to the crude oil, refined oil products and biofuels sectors.
BP, Shell, Statoil and price-reporting agency Platts all confirmed they were co-operating with the EC investigation.
Statoil said the suspected violations related to the Platts Market-On-Close (MOC) price assessment process and may have been on-going since 2002.
In a statement, the EC said: The Commission has concerns that the companies may have colluded in reporting distorted prices to a Price Reporting Agency to manipulate the published prices for a number of oil and biofuel products.
Furthermore, the Commission has concerns that the companies may have prevented others from participating in the price assessment process, with a view to distorting published prices.
Any such behaviour, if established, may amount to violations of European antitrust rules that prohibit cartels and restrictive business practices and abuses of a dominant market position.
It said that the price reported by agencies serve as benchmarks for trade in the physical and financial derivative markets for a number of commodity products in Europe and globally.
Even small distortions of assessed prices may have a huge impact on the prices of crude oil, refined oil products and biofuels purchases and sales, potentially harming final consumers.
It said the raids were a preliminary step to investigate suspected anticompetitive practices and does not mean that the companies are guilty of anti-competitive behaviour nor does it prejudge the outcome of the investigation itself.
A BP spokesman said: BP is one of the companies that is subject to an investigation that was announced earlier today by the European Commission. We are cooperating fully with the investigation and unable to comment further at this time.
A Shell spokesman said: We can confirm that Shell companies are currently assisting the European Commission in an enquiry into Trading activities. We are fully cooperating with the investigation. For legal reasons we cannot make any further comment at this stage.
Platts said it confirms that the European Commission has undertaken a review at its premises in London this morning in relation to the Platts price assessment process. Platts is cooperating fully with the European Commission's review.
Statoil also confirmed in a statement on its website that its Norwegian offices had been inspected.
source: BP, Shell and Statoil investigated over suspected oil price manipulation - Telegraph
The London offices of Shell, BP, Statoil and Platts, the worlds leading oil price reporting agency, were raided yesterday by European Commission inspectors, investigating allegations of collusion in price-fixing over the past 11 years.
After last years Libor scandal, these new allegations of price-fixing look set to be a further damning indictment (if ever that were needed) of capitalism and the unfettered greed of its corporations.
If the allegations are true, then it again shows how prices are based NOT on true cost, but on an arbitrary figure dreamed-up to give as much money to a selfish, spineless, avaricious few.
The price people pay for oil is based on a benchmark which is calculated by price reporting agencies based on data received from firms such as oil companies, banks and hedge funds, which all trade oil on a daily basis. It is these submissions which the EC suspect are possibly fraudulent.
A spokesman for the European Commission said:
The commission has concerns that companies may have colluded in reporting distorted prices to a price reporting agency to manipulate the published prices for a number of oil and biofuel products.
Officials carried out unannounced inspections at the premises of several companies active in and providing services to crude oil, refined oil products and biofuels sectors.
Even small distortions of assessed prices may have a huge impact on the prices of crude oil, refined oil products and biofuels purchases purchases and sales, potentially harming final consumers.
The price fixing of fuel just doesnt hit driverseverything that is dependent on road haulage is directed affected by such underhand collusionfood prices, heating, public transport costsall are increased and the costs will always hit the poorest worst.
According to the Guardian, Lord Oakeshott, former Liberal Democrat Treasury spokesman, said:
the alleged rigging of oil prices was as serious as rigging Libor which led to banks being fined hundreds of millions of pounds.
He demanded to know why the UK authorities had not taken action earlier and said he would ask questions of the British regulator in Parliament. Why have we had to wait for Brussels to find out if British oil giants are ripping off British consumers? he said. The price of energy ripples right through our economy and really matters to every business and families.
source: Dangerous Minds | A Price-fixing Scandal Bigger Than Libor?: How the Oil Companies have us over a barrel
BP, Shell and Statoil investigated over suspected oil price manipulation
BP, Shell and Statoil are under investigation by the European Commission over suspected collusion to distort the oil price.
The EC said it had concerns that several companies may have manipulated the oil price benchmark in violation of EU antitrust rules, potentially having a huge impact on oil and petrol prices.
Shares in the oil giants fell in early trading on Wednesday after European regulators began an investigation into whether the companies may have manipulated the price of oil for more than a decade. Shell was down 1.7pc, while BP fell 0.2pc.
The Commission said that on Tuesday it had raided the offices of several companies active in and providing services to the crude oil, refined oil products and biofuels sectors.
BP, Shell, Statoil and price-reporting agency Platts all confirmed they were co-operating with the EC investigation.
Statoil said the suspected violations related to the Platts Market-On-Close (MOC) price assessment process and may have been on-going since 2002.
In a statement, the EC said: The Commission has concerns that the companies may have colluded in reporting distorted prices to a Price Reporting Agency to manipulate the published prices for a number of oil and biofuel products.
Furthermore, the Commission has concerns that the companies may have prevented others from participating in the price assessment process, with a view to distorting published prices.
Any such behaviour, if established, may amount to violations of European antitrust rules that prohibit cartels and restrictive business practices and abuses of a dominant market position.
It said that the price reported by agencies serve as benchmarks for trade in the physical and financial derivative markets for a number of commodity products in Europe and globally.
Even small distortions of assessed prices may have a huge impact on the prices of crude oil, refined oil products and biofuels purchases and sales, potentially harming final consumers.
It said the raids were a preliminary step to investigate suspected anticompetitive practices and does not mean that the companies are guilty of anti-competitive behaviour nor does it prejudge the outcome of the investigation itself.
A BP spokesman said: BP is one of the companies that is subject to an investigation that was announced earlier today by the European Commission. We are cooperating fully with the investigation and unable to comment further at this time.
A Shell spokesman said: We can confirm that Shell companies are currently assisting the European Commission in an enquiry into Trading activities. We are fully cooperating with the investigation. For legal reasons we cannot make any further comment at this stage.
Platts said it confirms that the European Commission has undertaken a review at its premises in London this morning in relation to the Platts price assessment process. Platts is cooperating fully with the European Commission's review.
Statoil also confirmed in a statement on its website that its Norwegian offices had been inspected.
source: BP, Shell and Statoil investigated over suspected oil price manipulation - Telegraph
