Antitrust Law Daily Wrap Up, TOP STORY—EC Investigating Possible Price Manipulation by Oil Companies, (May 14, 2013)

By Jeffrey May, J.D.

The European Commission (EC) confirmed today that it has conducted dawn raids "at the premises of several companies active in and providing services to the crude oil, refined oil products and biofuels sectors." The EC is investigating whether the companies "colluded in reporting distorted prices to a Price Reporting Agency to manipulate the published prices for a number of oil and biofuel products" and whether they "prevented others from participating in the price assessment process, with a view to distorting published prices."

"The prices assessed and published by Price Reporting Agencies serve as benchmarks for trade in the physical and financial derivative markets for a number of commodity products in Europe and globally," the EC explained in its announcement. "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."

The EC did not identify the targets of the dawn raids. However, Norway-based Statoil issued a statement, saying that its office in Stavanger was visited by the EFTA Surveillance Authority, assisted by the Norwegian Competition Authority (Konkurransetilsynet). Statoil said that it was cooperating with the authorities in their inspection.

Oil companies BP plc and Royal Dutch Shell plc also have been identified as targets of the investigation.

According to Statoil, the inquiry is "related to the Platts’ Market-On-Close (MOC) price assessment process, used to report prices in particular for crude oil, refined oil products and biofuels, and may have been on-going since 2002."

Platts is a publisher of specialized information on energy and other commodity markets. The company is a division of McGraw Hill Financial.

Companies: BP plc; Royal Dutch Shell plc; Statoil; Platts; McGraw Hill Financial

MainStory: TopStory Antitrust