The Daily Sandwich

"We have to learn the lesson that intellectual honesty is fundamental for everything we cherish." -Sir Karl Popper

Location: Boston, Massachusetts, United States


Thursday, June 29, 2006

BP reportedly involved in price-fixing scheme

Oil executives are hitting the road on an exciting tour to defend themselves and their record profits, still denying that they have any control over energy costs. But BP is having an Enron moment, complete with recorded phone conversations and cooperative employees who claim that the corporation has been manipulating the market to drive up prices-- and use the proceeds to give themselves huge bonuses.

Government regulators on Wednesday accused traders at energy giant BP PLC of trying to corner the market for propane during the winter of 2004, in a scheme that temporarily drove prices higher for millions of rural Americans who use the gas to heat their homes.

In a lawsuit filed in Chicago federal court, the Commodity Futures Trading Commission said the traders--"with the knowledge, advice and consent of senior management"--bought up enough contracts to give BP a dominant position in the American propane market. They then used that power to illegally manipulate prices. (. . .)

"The purpose of the conspiracy was to enrich BP by inflating the price of propane in February 2004 and . . . to enrich the [traders] through bonuses and other remuneration from BP," the Justice Department claimed.