Earlier today the European Commission announced that they had raided the offices of several companies, across three countries, accused of price fixing in the oil sector.
See also
Why we can't trust the price we pay for oil and gas by Seth Freedman
Gas market inquiry due to supply fears
At the time of writing BP, Shell, the Norwegian firm Statoil, and the pricing agency Platts had all admitted being visited by stern men in long coats. Amusingly, Platts said they were on the receiving end of a review.
Total appear to be the whistle blowers, having reported that “several times a year, estimates of market prices on key [energy] indices . . . are out of line with our experience of the day”.
It is unclear at the moment who else will be implicated, so far so silent.
The companies under investigation “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.”
This must surely renew calls for tougher and better regulation, such as the regulatory reform that was back tracked on late last year.
This follows hot of the heels of allegations of price manipulation in the gas industry; a spokesman for the European Commission said they were not connected, however the investigation is at a very early stage.
In the gas market things got so bad that the gas companies, banks, trading houses, and pricing agencies, got so bad they stopped co-operating or speaking to each other.
Particularly damning is that is the same companies now embroiled in oil price fraud that have been accused manipulating the gas market too.
With all this taking place still under the shadow of the Libor scandal, it might make one wonder about exactly how rotten and grubby corporate culture has become in some of our top firms.
Will it only be a matter of time before we see another ‘crack open a bottle of Bollinger’ email?
