The PRA has offered to submit evidence to the European Commission on alleged anti-competitive pricing tactics in the UK fuel market.
The move followed raids on three oil companies and oil market data specialist Platts, by agents investigating allegations of oil-price fixing (see news extra, page 10).
In a letter to Alexander Italianer, head of the Directorate-General (DG) of Competition at the European Commission in Brussels, PRA chairman Brian Madderson addressed the current oil price fixing investigation and offered the PRA’s assistance.
Madderson said: "The PRA submitted a formal and detailed complaint to the Office of Fair Trading in February 2012 alleging that the UK fuel market was anti-competitive.
"This complaint, supported by Robert Halfon MP and his cross-party group of backbenchers, led to the OFT’s ’call for information’ in autumn 2012. Our members submitted yet further evidence of alleged malpractice in the market place leading to a further report to the OFT in December 2012 but still they refused to undertake their own investigation."
The PRA said both reports could be made available to the Commission’s investigating team along with further evidence from its members.
Madderson continued: "The PRA is also able to provide historical data on the daily wholesale cost of both petrol and diesel in pence per litre for the UK market using our unique BigOil software system. This takes into account the fluctuating $US v £ exchange rate and also the biofuels elements of both standard grades. This is data that we are happy to contribute to this vital investigation."
Just a week before the European Commission launched its investigation, the PRA had voiced renewed concerns about the unpredictability of prices in the wholesale petrol market.
In the previous seven days there had been a drop by more than 2.6ppl, which encouraged supermarkets to rush price reductions onto their forecourts. However, by the start of the following week, wholesale costs recovered all that reduction, resulting in a swing of more than 5.2ppl over a few days of trading, according to PRA chairman Brian Madderson.
"With the Platts-led market showing such volatility our independent retailers are finding it difficult to keep track of cost changes and plan their businesses," he claimed.
"It is impossible to justify a rise or fall in pump prices to consumers as the market is just not sufficiently transparent," he added.
The fluctuations in pricing were also highlighted in the AA’s latest fuel report. It said a 3.5ppl fall in the average pump price of petrol since mid April was the third big price swing in 12 months.
It reported the average price of petrol has fallen from 136.89ppl in mid April to 133.35ppl in May. Its highest point was 140ppl on March 4, having started the year at around 132ppl.
Diesel, was 138.17p a litre in mid May, down from 141.76p a month earlier, and it also reached a high for the year on March 4 of almost 146.5p a litre, having started the year at around 140p.
The latest swing in petrol prices is the third 8p to 10ppl ’price shock’ in 12 months, according to the AA.
The AA said it welcomed investigations on both sides of the Atlantic into pricing activities in the oil and road fuel wholesale markets, hoping that they will expose the level of contradiction between market speculation and the fundamentals of supply and demand.