Wyden Asks Fraud Task Force to Investigate Domestic Impact of E.U. Oil Market Manipulation

May 17, 2013

Washington, D.C. – Senate Energy and Natural Resources Committee Chairman Ron Wyden, D-Ore., today asked the Justice Department to investigate whether alleged price manipulation by three major oil companies in Europe is impacting U.S. consumers, and if similar activity is taking place in domestic markets.

On May 14, European Union regulators raided the offices of BP, Royal Dutch Shell and Statoil, as part of an investigation into whether they had falsely reported prices to the energy information company Platts, as part of an effort to manipulate oil markets.

Traders and oil companies depend on price benchmarks set by companies like Platts, which relies on self-reporting by oil companies and others to determine the prevailing price in oil and other petroleum markets. Because world oil markets are closely connected, price and demand changes in Europe and Asia often have broad ripple effects worldwide, including in the U.S.

In a letter to U.S. Attorney General Eric Holder, who chairs the Financial Fraud Enforcement Task Force, which is charged with preventing fraud in oil and gasoline markets, Wyden requested that Holder work with E.U. authorities to determine if fraud in Europe is impacting U.S. consumers at the gas pump, and  whether similar manipulation is taking place in the U.S.

“Efforts to manipulate the European oil indices, if proven, may have already impacted U.S. consumers and businesses, because of the interrelationships among world oil markets and hedging practices,” Wyden wrote. “These effects on American business make it imperative that your task force investigate whether any firms that may be using false information to manipulate oil prices here or abroad.”

The letter is below.