EU in oil price-fixing probe

European inspectors raided the offices of major oil companies BP, Shell and Statoil on Tuesday in a cross-border investigation into possible manipulation of oil prices. The European Commission on Tuesday issued a statement saying it had begun an investigation, without naming any of the companies involved.

BP, Shell and Statoil subsequently said that their offices were subject to investigation, as was the London offices of the Platts agency that compiles benchmark oil industry prices.

"Commission officials carried out unannounced inspections at the premises of several companies active in and providing services to the crude oil, refined oil products and biofuels sectors," the Commission said in its statement. "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."

Furthermore, the Commission said it believed that the companies under investigation "may have prevented others from participating in the price assessment process, with a view to distorting the published prices."

Lengthy probe likely

EU regulators are licensed to carry out spot checks at a company's offices as part of preliminary investigations, and the Commission stressed that such probes do not mean the companies are necessarily guilty of wrong-doing.

Benchmark prices and rates, compiled by agencies using a "snapshot" of prices across a number of major deals to make up a nominal price, have come under particular scrutiny since the manipulation of the banking sector's LIBOR and EURIBOR base interest rates.

The benchmark prices serve as a guide for thousands of other deals every day, and for the value of relevant stocks and shares. "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 European Commission said.

Platts is owned by McGraw Hill Financial, the company behind credit ratings agency Standard and Poor's.

Such anti-trust probes usually last for years, not months, and there is no formal deadline or timetable by which EU regulators must operate.

msh/jr (AFP, AP, Reuters)