Oil price probe widens, senator wants Justice Department help

Fri May 17, 2013 6:58pm EDT
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By Simon Falush and Timothy Gardner

LONDON/WASHINGTON (Reuters) - A European probe into possible oil price manipulation expanded with the investigation of a small niche trading house in the Netherlands, while a key U.S. senator on Friday called for the Justice Department to join the investigation.

Dutch trading house Argos Energies, a mid-sized trading company that deals in physical oil products and owns storage facilities, was visited by inspectors from the European Commission on Tuesday, a source familiar with the investigation said on Friday.

The visit occurred on the same day that authorities raided the London bureau of pricing agency Platts, and the offices of Statoil, Royal Dutch Shell and BP in the biggest cross-border action since the probe into rigging of Libor benchmark interest rates.

In Washington, the chairman of the Senate's energy committee asked the Justice Department to investigate whether alleged price manipulation has boosted fuel prices for U.S. consumers.

"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," Senator Ron Wyden, the chairman of the Senate Energy and Natural Resources Committee, wrote in a letter to Attorney General Eric Holder.

The U.S. Commodity Futures Trading Commission and Federal Trade Commission have both declined to comment on any role or coordination with EU authorities in the probe. U.S. politicians including Wyden often call for enquiries into issues that affect gasoline prices, although regulators are not obligated to take action.

A spokesman for the Justice Department would not comment on whether the agency would undertake a probe, but said it was reviewing Wyden's letter.

Authorities have sharpened scrutiny of financial benchmarks around the world since slapping large fines on some of the world's biggest banks for rigging interest rate benchmarks.   Continued...

Fuel pumps are seen at a Shell petrol station in London May 15, 2013. REUTERS/Luke MacGregor