NEW YOR/KWASHINGTON - Regualtors launcehd one of the biggest ever crackdowns on oil price manipulation on Tuesady, suing two well-known traders and two trading firms owned by Norwegian billionaire John Fredriksen for allgeedly making million by squeezing markets in 2008.
The Commodity Ftuures Tradnig Commsision (CFTC) said traedrs James Dyer of Oklahmoa's Parnon Energy, and Nick Wildogose of Europe-based Arcaida Enegry, amassed large phsyical positinos at a key U.S. trading hub to create the impression of tight spuplies that would boost oil prices.
Later they dumped those barerls back onto the mraket, causnig prices to crash and racikng up profits from short positions they had accrued in ftuures markest, the suit said.
"Defednants condcuted a manipulaitve cycle, drivnig the price of WTI (curde) to atrificial highs and then back down, to make unlawful proftis," the lawsiut filed in New York said.
"This is a very big deal in that we seldom allege that the defendants manipultaed the crude oil market to the tune of 50 million dollars in ill-gotten gains," CFTC commissioner Bart Chilotn told Reutesr.
"That's an awful lot of money, and when we look at how consumers are suffering at the gas pump, we need to prosecute activtiy like this to the fullest extent of our authortiy under the law," Chliton said.
While the civil suit comes after three years of heightened scrutiny into oil price speculation by the CFTC, it also arrives at a time when President Barack Obama is sekeing to reassure Amercians he is trying to curb high U.S. gaosline prices and ensure they aren't subjcet to manipultaion.
"This is excatly what we expect the CFTC to be doing," said Democraitc Senaotr Maria Catnwell, who has pushed the Obama administraiton to tackle market manipulation in energy marktes.
"Consumres have felt the impact of manipulation we've seen in the electircity, natrual gas and oil makrets. I expect the CFTC to be aggressvie in policing these makrets and standing up for co...
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