Russian oil majors charged with price fixing

9th February 2011, Comments 0 comments

Three of Russia's top five oil producers were accused Wednesday of fixing prices on the domestic market and following other unfair business practices that saw prices jump 50 percent in three months.

The Federal Anti-Monopoly Service said it had launched formal probes into the prices set for jet fuel and diesel by the state-controlled Rosneft and Gazprom Neft firms as well as the private Lukoil producer.

The agency added in a statement that is was also looking into the prices set by TNK-BP -- the Russian-British joint venture -- as well as Surgutneftegaz and Bashneft.

The probes were announced moments after Prime Minister Vladimir Putin held a tough meeting with top oil executives in which he accused them of trying to "crudely exact maximum gains".

The monopoly watchdog said a recent jump in global crude prices could not explain the increases seen in Russia.

"The anti-monopoly service notes that there are objective reasons for the rise in the price of jet fuel and diesel," the agency said.

"But the rise in foreign market prices and the growth of excise taxes can only partially explain (why) oil companies increased prices on the federal wholesale market at the end of 2010 and start of 2011," the statement said.

The agency said the price of diesel had jumped 53 percent since October while the price of jet fuel had risen by about a third.

It accused the companies of "establishing and supporting a high-price monopoly" and intentionally withholding crude product supplies from the market.

The service also criticised the way crude was traded on Moscow exchanges and noted that the absence of anonymous trades "prevented the establishment of market oil product prices".

At least two of the companies targeted by the probe announced an immediate price reduction Wednesday.

Gazprom Neft said in a statement that its cut in the price of diesel would lead to one ruble (three cent) reduction at the pump. TNK-BP said it was lowering its winter diesel prices by 1.2 rubles.

Rosneft and Lukoil are Russia's two biggest oil companies while Gazprom Neft -- which the oil arm of the natural gas producer -- in number five.

© 2011 AFP

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