U.K. Energy Regulator Yet to Decide on Gas Whistle-Blower Probe
The U.K.’s Office for Gas and Electricity Markets, Ofgem, has yet to decide whether to proceed with an investigation into claims of manipulation in wholesale natural gas markets made a year ago.
No “formal” investigation has begun into the issue, Lisa O’Brien, a spokeswoman at the London-based regulator, said by telephone Oct. 18.
Price-reporting agency ICIS, a unit of Reed Elsevier Plc, reported irregular trades to Ofgem in October 2012 after former reporter Seth Freedman flagged what he suspected was an attempt to manipulate assessments in the $480 billion U.K. gas market on Sept. 28 of that year. Ofgem opened a consultation into pricing benchmarks in the energy industry in June to ascertain “if stakeholders feel that current arrangements are fit for purpose,” it said at the time.
Freedman also notified the Financial Services Authority, now the Financial Conduct Authority, which confirmed Nov. 12 that it had received the information. The FCA doesn’t comment on investigations or if a probe is taking place, Toby Parker, a spokesman for the FCA, said today by telephone.
ICIS said in April it may change the way it calculates its indexes after some clients said they mistrust the company’s reporter-led assessments. Platts, a unit of McGraw-Hill Cos. that also provides gas-price indexes, was raided in May as part of a European Union antitrust probe into the pricing in the physical oil market.
David Davis, a Conservative Party lawmaker, has a “hunch” that Ofgem will uncover “some rigging in the gas market,” he said on BBC Radio Five Live on Oct. 6.
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