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| Companies guilty of oil price fixing will face charges, says David Cameron | Companies guilty of oil price fixing will face charges, says David Cameron |
| (3 days later) | |
| David Cameron has warned that anyone found guilty of the "hugely concerning allegations" of oil price fixing should face the "full force of the law". | David Cameron has warned that anyone found guilty of the "hugely concerning allegations" of oil price fixing should face the "full force of the law". |
| Speaking in New York, the prime minister said the allegations were "very, very serious" and "major consequences" would follow as he pledged to ensure that laws passed in the wake of the Libor scandal would apply to oil price fixing in the future. He was also forced to try to explain why a similar investigation barely four months ago by the Office of Fair Trading (OFT) in Britain had come up empty-handed. | Speaking in New York, the prime minister said the allegations were "very, very serious" and "major consequences" would follow as he pledged to ensure that laws passed in the wake of the Libor scandal would apply to oil price fixing in the future. He was also forced to try to explain why a similar investigation barely four months ago by the Office of Fair Trading (OFT) in Britain had come up empty-handed. |
| Cameron said: "These are hugely concerning allegations and, if true, very, very serious. The OFT is involved in this investigation, as I understand it, but we have to get to the bottom of what happened first before we can pass judgment on the way regulators have worked in the UK. But it is hugely concerning. An investigation is under way." | Cameron said: "These are hugely concerning allegations and, if true, very, very serious. The OFT is involved in this investigation, as I understand it, but we have to get to the bottom of what happened first before we can pass judgment on the way regulators have worked in the UK. But it is hugely concerning. An investigation is under way." |
| "It's totally unacceptable for firms to fix prices and force consumers to pay more. That's why we are looking at how to extend this criminal offence to the energy sector to make sure that those who manipulate benchmark prices feel the full force of the law." | "It's totally unacceptable for firms to fix prices and force consumers to pay more. That's why we are looking at how to extend this criminal offence to the energy sector to make sure that those who manipulate benchmark prices feel the full force of the law." |
| The prime minister initially said that laws introduced in the wake of the Libor scandal could apply to alleged oil price fixing. Downing Street was forced to correct the prime minister and say this was not the case, but that the prime minister hoped the law could apply to oil price fixing in the future. | The prime minister initially said that laws introduced in the wake of the Libor scandal could apply to alleged oil price fixing. Downing Street was forced to correct the prime minister and say this was not the case, but that the prime minister hoped the law could apply to oil price fixing in the future. |
| BP, Shell and the oil price reporting agency Platts all had their London offices raided on Wednesday by competition authority investigators who are concerned about collusion and manipulation of oil and biofuel product markets. The three companies – and Statoil of Norway – have all promised to co-operate fully. | BP, Shell and the oil price reporting agency Platts all had their London offices raided on Wednesday by competition authority investigators who are concerned about collusion and manipulation of oil and biofuel product markets. The three companies – and Statoil of Norway – have all promised to co-operate fully. |
| Ed Davey, the energy and climate change secretary, confirmed that an official from the OFT accompanied colleagues from Brussels on the unannounced raids. | Ed Davey, the energy and climate change secretary, confirmed that an official from the OFT accompanied colleagues from Brussels on the unannounced raids. |
| But he specifically mentioned that the investigation was not "directly linked" to the allegations of gas market manipulation raised last November by the Guardian, which Ofgem and the main City regulator, the FCA, are continuing to review. | But he specifically mentioned that the investigation was not "directly linked" to the allegations of gas market manipulation raised last November by the Guardian, which Ofgem and the main City regulator, the FCA, are continuing to review. |
| The way petrol prices in Britain remain high even after falls in the value of global wholesale oil have long been a source of deep anger and frustration for motorists and motoring groups such as the AA. | The way petrol prices in Britain remain high even after falls in the value of global wholesale oil have long been a source of deep anger and frustration for motorists and motoring groups such as the AA. |
| Four months ago the OFT ruled out a full investigation into allegations of petrol price fixing after finding that competition in the sector was "working well" and that there was "very limited evidence" that pump prices rise quickly when the wholesale price goes up but fall more slowly when it drops. | Four months ago the OFT ruled out a full investigation into allegations of petrol price fixing after finding that competition in the sector was "working well" and that there was "very limited evidence" that pump prices rise quickly when the wholesale price goes up but fall more slowly when it drops. |
| Caroline Flint, the shadow energy secretary, described the alleged behaviour of the oil companies as shocking, while Robert Halfon, the Tory MP for Harlow, called for prison sentences for any executives found to have overseen any price fixing. | Caroline Flint, the shadow energy secretary, described the alleged behaviour of the oil companies as shocking, while Robert Halfon, the Tory MP for Harlow, called for prison sentences for any executives found to have overseen any price fixing. |
| He told the BBC: "Last year we urged the Office of Fair Trading to launch a full inquiry into alleged price fixing by oil companies. I had a whistleblower approach me with a dossier which we put up on our website called petrolpromise.com and sadly, nothing was done. | He told the BBC: "Last year we urged the Office of Fair Trading to launch a full inquiry into alleged price fixing by oil companies. I had a whistleblower approach me with a dossier which we put up on our website called petrolpromise.com and sadly, nothing was done. |
| "The Office of Fair Trading did a limp-wristed, lettuce leaf-type inquiry and they should have had a full inquiry. Now we've left it up to the EU to take action." | "The Office of Fair Trading did a limp-wristed, lettuce leaf-type inquiry and they should have had a full inquiry. Now we've left it up to the EU to take action." |
| The oil market-fixing probe has been compared by some experts to the Libor scandal, which saw the banks falsely reporting key interest rates used to calculate mortgages. It also comes after Seth Freedman, a price reporter and whistleblower, highlighted huge fluctuations in the British wholesale gas market on 28 September, which indicated there could be market abuse. | The oil market-fixing probe has been compared by some experts to the Libor scandal, which saw the banks falsely reporting key interest rates used to calculate mortgages. It also comes after Seth Freedman, a price reporter and whistleblower, highlighted huge fluctuations in the British wholesale gas market on 28 September, which indicated there could be market abuse. |
| Flint asked Davey in the Commons for an update of the investigations by Ofgem and the FSA, which she failed to get. She then asked: "Can the secretary of state assure us we will not need another EC investigation to get to the bottom of what was happening in the gas market?" | Flint asked Davey in the Commons for an update of the investigations by Ofgem and the FSA, which she failed to get. She then asked: "Can the secretary of state assure us we will not need another EC investigation to get to the bottom of what was happening in the gas market?" |
| The energy secretary said it would not be right to interfere in the workings of the UK regulators, whose independence was critical to their effectiveness. | The energy secretary said it would not be right to interfere in the workings of the UK regulators, whose independence was critical to their effectiveness. |