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Updated: 19/07/2012 06:44 | By motoringresearch.com
Report: are petrol prices being fixed?
A report from the G20 has found that the market for oil prices is open to “manipulation or distortion”, leading to concern that motorists may have been paying too much for petrol.
According to the Telegraph there are growing fears that banks and other traders may have tried to artificially alter oil pricing in a similar manner to the LIBOR interest rate scandal that’s currently under investigation by the Bank of England.
Fuel prices: everything you need to know
The International Organisation of Securities Commissions prepared the G20 report for world finance ministers, including UK Chancellor George Osborne. It suggests that due to way oil trade prices are reported, it would potentially be possible for traders to influence values – which would in turn impact on how much people are paying for fuel on filling station forecourts.
Not only is the entire system of price reporting “voluntary” – allowing banks, energy companies and other traders to choose which trades they make public – the possibilities for private economic gain due to false reporting effectively creates an “incentive” to carry out such attempted distortion.
MP for Harlow, Robert Halfon, who leads a group of 100 MPs calling for lower fuel prices, said in the Telegraph that the matter: “needs to be looked at by the Bank of England urgently.”
He continued: “We need to know whether the oil price has been manipulated in a similar way to LIBOR. This impacts on millions of people all round the country concerned about the price of petrol at the pumps.”
Halfon’s concerns are echoed by other politicians, US regulators, the Petrol Retailers’ Association and various experts in the field. Including chief executive of the Global Financial Markets Association Simon Lewis, who has suggested that oil price reporting agencies may lack impartiality, due to the fees they receive from banks and oil companies for information.
Others, such as Raymond Learsy, author of ‘Oil and Finance’, are asking: if LIBOR can be rigged, then what’s to stop the same thing happening with oil prices? “The oil price is not a true reflection of supply and demand,” he said to the Telegraph.
However, oil price reporting agencies Platts, Argus Media and ICIS have hit back at such claims, by pointing out that the system employed here has “fundamental differences” to that supposedly regulating the also voluntary LIBOR interest rate measure (which Barclays was found to have manipulated earlier this month).
In a joint statement, they explained that they are “independent of and have no vested interest in the oil and energy markets”.
Data quality, competition between agencies and transparent methodology as well as independence are all said to create significant differences between oil pricing and LIBOR. They also employ journalists to specifically spot any attempt at artificial distortion in the figures reported to them.
Convincing? We’ll have to wait and see. As yet neither the Bank of England nor the British Government has confirmed the intention to investigate further.
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42Comments
16/07/2012 14:05
Funny how the price drops just in time for the Olympics so that all the visitors can say "oh look fuel prices are not as bad as we thought".
I cannot believe this government think the British public are so stupid that we dont know what is going on.
I cannot believe this government think the British public are so stupid that we dont know what is going on.
16/07/2012 14:12
Is there any price of every day items that is,nt rigged by the rich? Bank rates, oil,gas,electric, phone charges, tv viewing?? They are but a few that are in the hands of the rich. The Mps are either rich or controlled by their rich backers. So what chance have the workers got? They put the price up of everything we need but expect us to work for less and longer. Pay more in to their pension run funds and milk off the interest. When will it ever stop?
16/07/2012 15:43
Of course petrol prices are fixed. Oil companies are a cartel who manipulate prices however, the worst ones are the government who know exactly how to extract money from us. When times are hard and they need cash simply rip off the motorists who they know have to use transport to get to work or around generally. It's a very quick way for any government to raise money, huge amounts of it fast. that's why we have not seen petrol come down despite the cost of oil being lowered. It's a rip off and fixed
16/07/2012 14:36
RIP-OFF BRITAIN (FACT)
16/07/2012 15:43
It really is disgusting how this world works, the police harass ordinary people for the most trivial little things I.E., not wearing a seatbelt, getting drunk and be a nuisance but harmless, etc.
Yet time after time, we have seen all the big businesses and even the worlds governments commit the largest of crimes.
The banks need i say more !
The energy companies, fuel, gas, electricity all illegally refusing to pass on drops in the wholesale price to the public, now the above story of deliberate price rigging.
The british government, starting illegal wars, the expenses scandal, and god knows what else that we don`t know about.
What happens to any of the above groups for commiting very serious crimes and moral wrongs ?
NOTHING !
16/07/2012 15:53
All the big petrol companies and successive governments have been going hand in hand since the eighties, petrol companies screwing us with excessive profits and the government with excessive taxation and none of them give a toss about joe blogs.
16/07/2012 17:55
I'll tell you when it will stop. If people stop being stupid just for once and at the next election vote for UKIP to get us out of Europe. We will have billions extra to build more schools, hospitals and prisons. Don't listen to all the MP's who say it will be a disaster, we buy more fron Europe than they buy from us, they cannot do without trading with us, plus we would be free to buy from wherever we want and would not be aiding the French economy by the sorry waste of moving the European Parliament from Brussels to Strasburg just to please them. WAKE UP BRITAIN, BEFORE IT IS TOO LATE.
16/07/2012 15:43
We always have been overcharged for fuel. Do you remember when diesel was cheaper than petrol? People were encouraged to buy diesel cars because of their lower running costs, trucks have no viable alternative fuel, so its always a major generator of revenue for the government, regardless of which one is in power at the time. Now people have been encouraged to convert cars to LPG, the average cost of a decent conversion will see the owner having to cover around sixty to seventy thousand miles to cover the cost of the conversion on fuel savings. And of course now the price of LPG is creeping up as well. We have no usable alternative to owning a personal car unless you live in a large city and never want to go out of it. Public transport is expensive, unreliable and dirty. I can go from East Sussex to Suffolk in around two hours by car on around £15 of fuel, the same journey by train takes me four and a half hours and an advance ticket still costs me around £30, and the train service I use is not available on a Sunday. No government regardless of which party they are are going to drop the price of fuel to it's real leval because of the revenue it generates.
16/07/2012 17:58
Madness! It's not the manipulation of the crude oil price that is keeping the pump price high, its the retailers fixing the price, by not lowering it when the oil price goes down.
Crude goes up, retail price goes up. Crude oil price comes down, retail price stays the same, for months after word and never actually get back to the original price.
When the supermarkets drop the price by 5p, all of the retailers follow suit. The question that should be asked is "how long have the retailers been holding consumers to ransom for 5 p per litre?" and "by how much more is the public held to ranson by the petrol retailers?"
There should be an independely set retail price guide line, so that consumers can see how much more the retailers are charging us!
16/07/2012 15:32
I wouldn't worry so much that it's being fixed....What bugs me is the disgraceful amount of TAX
that being heaped on a litre of fuel....but we go along with it don't we ? I just wish there was a day or a weekend where there was a national " I am not going to buy any fuel" occassion - I would join in -
Just imagine what it would do if we said "screw this , I am not going to drive my car for a month"......
that being heaped on a litre of fuel....but we go along with it don't we ? I just wish there was a day or a weekend where there was a national " I am not going to buy any fuel" occassion - I would join in -
Just imagine what it would do if we said "screw this , I am not going to drive my car for a month"......
16/07/2012 15:22
Yes the prices are being fixed but this is mainly due to the Government putting so much tax on it. They also ignore the fact that it is not the ordinary motorist who is slammed by the high price of petrol it is even the folk to don't have a car due to the price of everything transported by road having to go up to cover every singe increase in petrol. Mind you petrol goes up an awful lot quicker than it comes back down again.
16/07/2012 21:57
Of course they are fixed, stupid question.....
NEXT FRIDAY AVOID BUYING BP FUEL,,,,
Just for one day the following Friday
AVOID BUYING SHELL.....
NEVER BUY FUEL ON THE MOTORWAY ... ONLY FOOLS BUY ON THE MOTORWAY
Do what the Americans and the Mexicans do ... if it's too expensive buy elsewhere
In Mexico fuel is 50p per litre.....
16/07/2012 18:36
something must be amiss, because the banks were hoarding tankers not so long ago waiting for prices to rise, that must surely be manipulation of the markets
16/07/2012 17:16
Its about time the british Public woke up and stopped being sheep the goverment still get there wage rises whilst the rest of us have been frozen.Prices are at an all time high due to us being taxed on everything Can you afford to take your family out at weekends NO due to high fuel prices cars are becoming a luxury for the rish once again.WAKE UP BRITAIN.
16/07/2012 16:06
Yes petrol is being fixed by suppliers, garages and supermarkets, don't be fooled, when these spend £40 or £50to get 5p or 6p off a litre, you can guarantee that the cost of the fuel has gone up just a couple of weeks before hand, local garages then follow suit, a bit of the sun and up they go again, not 4 weeks ago fuel had come downby 5p a litre at the pumps, now it is back up and will creep up as soon as Autumn/Winter comes, also the Olympics are here, so further profit and increase of prices will go on, fruit and salad have come down but eggs, milk, meat and other products have rocketed again, yet again we have to pay more in the long run, for others blunders or greed.
16/07/2012 22:04
will someone tell me why supermarkets are giving you 6pence off a litre of fuel when you spend £40.00 or more instore.
shurly they are adding that 6pence on in advance and shurly its just us fools that let them do this to us and thinK (oh my god thats a bargin)
unfortunatly guys wake up and note foods going up at alrming speed and i can assure you we dont get something for nothing.
I AM RIGHT BECAUSE ITS ALREADY ADDED ON TO YOUR BILL ONCE INSTORE.
NON OF THIS SHUOLD HAPPEN.
AND IN CASE IM ASKED IM NOT PROUD TO BE BRITISH ANYMORE SINCE IVE SEEM ALL THE POLITICAL SCANDALS GOING ON.
A REAL GOVERMENT WOULD REPRESENT ITS OWN PEOPLE LIKE IT WAS SET UP FOR NOT TO BE CORRUPT IN THE WAY IT IS TODAY.
I WAS TOLD BY MY PARENTS,YEARS AGO THE GOVERMENT WAS SET UP TO TAKE CARE OF ITS PEOPLE AND BE JUST AND FAIR TO ALL.
SO FAR IVE ONLY SEEM 2 WARS,ANOTHER ON THE WAY,PEOPLE SUFFERING FINACALY,PEOPLE ON THE BREADLINE AND CANT AFFORD TO HEAT THERE HOMES.
HERES ONE TO THINK ABOUT MY FRIENDS.
IM WITH BRITISH GAS,WE HAVE OUR WATER HEATER ON FOR 1 HOUR EVERYDAY.
WE DONT USE THE CENTRAL HEATING EVER NOT EVEN IN ALL THIS BAD WEATHER WE HAVE HAD,BEEN LIKE THAT FOR NEARLY 2 YEARS NOW WITH US,COUNCIL DISCONECTED OUR LIVINGROOM FIRE A MONTH AGO.(UPON REQUEST AS WAS NEVER USED )
AND WOW IVE BEEN TOLD IM GOING TO HAVE TO PAY AN EXTRA £16.00 A MONTH FOR MY GAS OR FIND ANOTHER SUPPLYER.
NOW YOU TELL ME ITS A DECENT COUNTRY.
OH AND MY ELECTRIC BILL WENT UP £26.OO 6 MONTHS AGO TOO.
I HATE THE UK,THIS GOVERMENT, NEEDS GETTING RID OFF AND PUT PEOPLE WHO CARE ABOUT THE COUNTRY BACK IN POWER AND REMOVE THEM IF THEY DONT DO A GOOD JOB.
MAKE THEM ANSWER TO US THE PUBLIC AS IT SHOULD BE THAT WAY.
RIGHT NOW,ALL THEY DO IS UNDERHANDED TRICKS ON US ALL.
THIS COUNTRY WAS ONCE A FANTASTICLYWELL RESPECTED RICH NATION NOW WERE AMONGST THE POOREST.
AND DONT GET ME STARTED ON THE AMOUNT OF OUR OWN HARD EARNT MONEY WE PUT IN TAXES ONLY TO REALISE ITS BEING USSED TO FUND THIS EU THING AND LOADS GIVEN TO OTHER COUNTRYS FREELY.
IM NOT AGAINST HELPING DISATER HIT COUNTRYS BUT THEY GIVE SO MUCH IN BILLIONS AND ITS GETTING MORE N MORE OFTEN.
HOW ABOUT LOOKING AFTER YOUR OWN FIRST AND NOT TAKE,TAKE TAKE FROM US ALL.
UK PHEEEE .
WE WONT EVER GET THAT BACK ON TRACK UNLESS WE STAND UP TO THESE BULLIES WHO ABUSED US ALL FOR ALL THESE YEAR GONE BY TO THE PRESENT DAY.
16/07/2012 17:31
I remember driving to work (in a garage) inthe70s,stopping to buy petrol at just under a £ a gallon,saying to myself if this goes to a £ a gallon i'm giving up driving.I'm still driving.What bloody fools we are.
16/07/2012 20:46
In the nineties when the tories were in power they put an fuel escalator of 3% above inflation which was thought excessive at the time, then Labour got in and raised the fuel escalator to 6% above inflation, sometimes it was used twice in a year. As a self employed truck operator in early '97 I was paying 53ppl for fuel. Look what happened to fuel prices under Labour, prices rocketed, tens of thousands of firms went bust. People might think the tories are bad but as far as fuel prices go we'd be far,far worse off under the thieving labour morons.
16/07/2012 17:20
Some prices are fixed by local retailers.Here in Nuneaton 5 local filling stations are owned by the same family,prices are high compaired with stations a few miles away,as much as 5p a litre cheaper.I always wait untill I am passing one of the cheaper stations,then get what I need till the next time.
16/07/2012 18:18
Normally, one would offer the premise that those involved are innocent until proven otherwise. After watching what's been going on with oil for the last half-decade, I for one, am seeing things the other way.
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