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Germans attack BP, Shell for over-charging for petrol

Five big oil companies, including BP and Shell, are in trouble with the German regulator for over-charging drivers at petrol stations.

Petrol has become a contentious issue for households across Europe as prices at the pump have risen in line with the soaring oil price above $120 per barrel.

Rowena Mason
By Rowena Mason 6:59PM BST 26 May 2011

The German cartel regulator accused BP, ExxonMobil, Shell, ConocoPhillips and Total of running an “oligopoly” with a stranglehold on 65pc of the market.

The findings, which were vigorously denied by the oil companies, could not come at a more sensitive time for motorists and fuel retailers.

Petrol has become a contentious issue for households across Europe as prices at the pump have risen in line with the soaring oil price above $120 per barrel.

Oil has since gone down by $10 a barrel this month, but this led to only a 0.5p drop in the average price of a litre of petrol in the UK – when the AA calculates the drop should be more like 4p.

Average petrol prices hit 137.43p per litre earlier this month – a 1.64p rise on the mid-April average.

Luke Bosdet, of the AA said the motoring group would welcome a Europe-wide investigation into why petrol prices are still so high. He said: “We want an explanation for why petrol prices have reached the record levels of 2008 when the oil price is 15pc to 20pc lower than in 2008.

In Germany, the competition watchdog found that the prices at most major petrol stations are higher than necessary and do not reflect competition in the industry.

The investigators claimed that the “oligopoly” manipulate the market to increase prices before weekends, public holidays and school holidays, with Fridays being the most expensive day.

It banned any further takeovers or expansion of the five big companies’ petrol station operations without close scrutiny from the regulator.

The Cartel Office found no evidence of deliberate collusion but said the companies were quickly following each other in raising prices above the level they should be.

It said it could not force the retailers to lower their prices but urged consumers to shop around to find the cheapest prices for their

Peter Ramsauer, the German Transport Minister, has long been pushing for tougher competition to “stop the excesses in pricing at the petrol pump”.

However, a spokesman for BP in Germany vigorously defended the market against the accusations of the regulators. “There is no control of the market by an oligopoly,” he said. “What the Cartel Office’s observations do not mention is the fact that the members of this alleged oligopoly run only one half of the approximately 14,800 retail stations in Germany. In other words, consumers are free to choose who they go to.”

He also said there were legitimate reasons why petrol prices would be higher at weekends than the week.

“Currently, prices are often highest on Fridays and lowest on Sundays and Mondays. The reason for this is that price competition at the weekend has increased drastically in the last few years and, in consequence, prices fall more steeply. The same applies to public holidays.”

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