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BP and Royal Dutch Shell raided

BP and Royal Dutch Shell saw their offices raided today as the European Commission launched an investigation into oil price fixing. The Commission said it is concerned there has been collusion aimed at manipulating the prices of not only oil, but also petrol and biofuels.

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 A bogus market?

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By This Is Money Reporter

PUBLISHED: 16:58, 14 May 2013 | UPDATED: 17:17, 14 May 2013

BP and Royal Dutch Shell saw their offices raided today as the European Commission launched an investigation into oil price fixing.

Norway’s Statoil and price reporting agency Platts have also admitted to working with the authorities in their inquiries.

The Commission said it is concerned there has been collusion aimed at manipulating the prices of not only oil, but also petrol and biofuels.

It added that the anti-competitive co-operation may also have prevented others from taking part in the assessment of market prices.

The Commission said its inspectors raided companies in two EU member states and had asked for similar action in a non-EU member by European Free Trade Association officials.

Unannounced inspections are usually a preliminary step to investigating suspected anti-competitive practices.

There is no legal deadline to complete inquiries into suspected anti-competitive conduct and the Commission said the raids did not mean the companies were guilty of any charges.

Platts said: ‘The European Commission has undertaken a review at its premises in London this morning in relation to the Platts price-assessment process. Platts is co-operating fully with the European Commission’s review.’

BP said in statement: ‘We are co-operating fully with the investigation and are unable to comment further at this time.’

Oil companies in the UK came unscathed out of an Office of Fair Trading probe earlier this year.

The OFT found that competition was ‘working well’ at the petrol pump and that price rises over the past decade are largely due to increases in tax and the cost of crude oil.

It said it found ‘very limited’ evidence that pump prices rise quickly when wholesale prices go up but fall more slowly when it drops. As a result, it did not launch a full investigation into the market.

The watchdog failed to implement a measure called for by motoring organisations that would have seen wholesale petrol prices published, so that customers could easily see whether the price at the pump was fairly rising and falling.

SOURCE

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