EU anti-trust head warns of damage of oil-price fixing

Oil-price manipulation may have wrought “huge” damage to consumers, the EU’s anti-trust chief said yesterday as he drew comparisons with EU investigations into the rigging of bank rates.

While it is too soon to draw conclusions from the May 14 raids on Royal Dutch Shell, BP, Statoil ASA, and Platts, EU competition commissioner Joaquin Almunia said both sets of probes target price manipulation through a reporting system.

Anti-trust regulators arrived unannounced at Platts, as well as at oil companies, in its investigation into possible collusion by traders. Platts provided data and is co-operating with the inquiry. It continues to publish benchmark prices, including North Sea Dated Brent, against which more than half the world’s crude is valued.

“We are still in the first steps of the procedure,” Almunia said. “If de facto the manipulation is confirmed,” it would have led to “huge” damage to consumers, he said.

The three oil companies have all said they are co-operating with the commission. Speaking two days after the anti-trust raids, Statoil chief executive Helge Lund said the company has “zero tolerance” for breaches of the rules. Shell is committed to the “highest standard of corporate behaviour”, CEO Peter Voser said on May 21.

The EU probe underscores how pricing in some energy markets lacks the transparency of financial products such as stocks. It marks the third time global pricing benchmarks have drawn regulators’ scrutiny in the past year, following investigations into bank manipulation of the London interbank offered rate, or Libor, and ISDAFix, the benchmark for the $379tn (€292.9tn) swaps market.

“To some extent this problem has similarities with the benchmarks in the financial sector and with the investigations we are carrying out on Libor, Euribor, and Tibor cases,” Almunia said, referring to EU probes into those financial benchmarks.

“In these investigations our goal is to make sure that the companies have not colluded to manipulate their prices.”

© Irish Examiner Ltd. All rights reserved

More in this Section

Central Bank warns ‘Brexit will bring no good’

Spain and Portugal avoid EU fines over breaching budget rules

Michael O’Leary’s pay soars 33% on record Ryanair revenues

Facebook fails to show up for US taxman on Irish tax


Breaking Stories

Amazon reveals soaring sales in latest earnings announcement

Google was very happy with its latest financial results, calling them 'terrific'

Microsoft Pix is the cool new photography app from the Windows maker - just for iPhone

EDF board votes in favour of Hinkley Point nuclear power station

Lifestyle

There will always be a need for the LGBT community to bare its soul on Pride day

Telling both sides of Bobby Sands' story

All hunky-dory for happy Ellen DeGeneres

Jason Bourne is back again by popular demand

More From The Irish Examiner