EU raids oil, biofuels companies in price collusion probe

Royal Dutch Shell Plc and Statoil ASA said they were targeted by European antitrust officials in an investigation into plotting to manipulate published prices.

The European Commission said in a statement that inspections took place in two European Union member states.

“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,” it said in the statement.

Platts, a pricing service, uses an electronic pricing window in which companies make bids and offers, and strike deals that are used to formulate its price assessment. The agency said in March it would introduce a quality premium for Ekofisk and Oseberg crudes, two of the four grades that make up the Dated Brent marker used to price more than half the world’s oil. That came less than two weeks after Shell made adjustments to its trading contract for three blends including Brent.

Inspections were also carried out on the EC’s behalf by the EFTA Surveillance Authority in one European Economic Area member state, the Brussels-based commission said.

Statoil ASA, Norway’s largest oil and energy company, said it was raided as part of a probe into anti-competitive practices related to oil pricing.

“The authorities suspect participation by several companies, including Statoil, in anti-competitive agreements and/or concerted practices,” the company said. “In addition, the inspection relates to potential abuse of possible dominant position by another party.”

Cooperating Fully

The suspected violations are related to the Platts’ Market-On-Close 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, Statoil said.

Platts said the EC undertook a review at its premises in London today in relation to the Platts price assessment process.

“Platts is cooperating fully with the European Commission’s review,” it said in a statement.

Shell, Europe’s biggest oil company, confirmed that Shell companies are “currently assisting” the European Commission in an inquiry into trading activities.

“We are fully cooperating with the investigation,” Shell said in the statement, without giving any more details.

A spokesman for Glencore Xstrata Plc couldn’t immediately comment. The company trades about 3 percent of the world’s oil. BP Plc wasn’t able to immediately comment.

Bloomberg News

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