http://www.bloomberg.com/news/2013-05-15/eu-oil-manipulation-probe-shines-light-on-platts-pricing-window.html
Two weeks after Royal Dutch Shell Plc (RDSA) and Platts changed the way more than half of the world’s crude is valued, the companies along with BP Plc (BP/) and Statoil ASA (STL) are being probed by European antitrust regulators about potential manipulation of oil prices.
The investigation by the European Commission shines a light on how price reporting companies including Platts, the energy news and data provider owned by McGraw Hill Financial Inc., help determine the cost of raw materials used in everything from plastic bags to jet fuel. The suspected violations are related to the Platts’ Market-On-Close assessment process, or so-called window, and may have been ongoing since 2002, Statoil said.
“The industry has developed a high degree of reliance, you can almost call it dependence, on price reporting agencies,” said John Driscoll, the managing director of JTD Energy Services Pte., a Singapore-based energy advisory, and former trading manager at GS Caltex. “They have tremendous discretionary power in their ability to interpret and publish prices.”
Platts has been assessing the cost of oil since at least 1923 when its founder, Warren Platt, started Platt’s Oilgram, a daily newsletter devoted to prices and market information. The influence of reporting companies has grown since the mid-1980s when the industry began using market prices instead of a system where they were set by international oil companies and the Organization of Petroleum Exporting Countries.
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