U.S. regulators in talks with EU on energy price probe

Fri Sep 6, 2013 1:22pm EDT
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By Simon Falush and Douwe Miedema

LONDON/WASHINGTON (Reuters) - U.S. regulators are in talks to join European officials in their investigation of the oil markets, a European politician said, as both sides hunt for signs that trading benchmarks have been compromised.

But while the European Union has already raided the offices of major oil companies and price publisher Platts, the U.S. derivatives regulator has yet to launch a formal probe, two people familiar with the matter said.

"(The European Commission) is talking to regulators in the different member states and to the U.S.," Arlene McCarthy, vice-chair of the European Parliament's economic and monetary affairs committee, told Reuters.

"They are talking to the CFTC (Commodity Futures Trading Commission) and the Department of Justice, so there's quite a level of co-operation going on there," she said.

The European probe is likely to last until next May and is on a similar scale to the probe into the Libor interest rate benchmark, McCarthy said.

The EU executive in May raided the offices of oil majors BP, Shell and Statoil as well as price reporting agency Platts in an investigation of suspected manipulation of oil prices.

The CFTC, a leading actor in the Libor scandal in which three large banks have so far paid fines, is also monitoring energy markets for any sign that people in the industry have manipulated benchmarks.

The agency, whose powers have been vastly expanded by the 2010 Dodd-Frank Wall Street reform law, has stepped up the pace of seeking information from market parties about the issue, one commodity industry source said.   Continued...