US Senate energy leader seeks oil manipulation inquiry

17 May 2013 21:32  [Source: ICIS news]

WASHINGTON (ICIS)--A top Senate energy leader on Friday asked for a Justice Department inquiry into what he termed alleged price manipulation by oil companies in Europe, to determine if similar activities are taking place in the US.

Senator Ron Wyden (Democrat-Oregon), chairman of the Senate Energy and Natural Resources Committee, said he has asked US Attorney General Eric Holder to coordinate with European authorities and determine “whether or not similar efforts have been made to manipulate US oil indices”.

Wyden was referring to a move by the European Commission (EC) earlier this week to investigate possible price manipulation.

The EC said on Tuesday that it had carried out unannounced inspections at the offices of companies in two member states as part of an investigation into the trading of crude oil, refined oil products and biofuels.

Shell, BP, and the price reporting agency Platts confirmed that they had been visited by commission officials.  Statoil said it had been visited by European Free Trade Area (EFTA) and Norwegian competition authorities.

“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,” the European Commission said in a statement.

In his letter to Holder, Wyden asked him to determine “if fraud in Europe is impacting US consumers at the gas pump and whether similar manipulation is taking place in the US”.

Although Wyden referred to allegations and fraud in European energy markets, the EC in fact has made no formal charges or findings of wrongdoing.

As attorney general, Holder is the top official at the US Justice Department and the chief law enforcement officer of the federal government.

Wyden said that “Efforts to manipulate the European oil indices, if proven, may have already impacted US consumers and businesses because of the interrelationships among world oil markets and hedging practices”.

“These effects on American business make it imperative that your task force investigate whether any firms may be using false information to manipulate oil prices here or abroad”, Wyden said in his letter.

Holder also is chairman of the federal Financial Fraud Enforcement Task Force, a special unit that combines investigative assets of multiple federal agencies.

Wyden did not specify a deadline for Holder's response, saying only that he looked forward to hearing the attorney general's reply on his work with the EC on the matter. But Holder is likely to answer the committee chairman soon.

Additional reporting by Nigel Davis in London

By: Joe Kamalick
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