Drivers may have paid too much for fuel over 10 years
MOTORISTS in Ireland may have been paying too much for petrol for the last decade as the EU probes a potential Europe-wide price-rigging scam.
EU investigators raided the offices of top oil companies Shell, BP and Statoil on Tuesday to investigate if oil price reports have been distorted in a way that would ultimately lead to higher prices for consumers.
Irish petrol prices have almost doubled from 82c a litre in 2002 to €1.58 a litre now, The EU probe is trying to establish if any of this surge is down to oil companies colluding to distort prices.
It was launched on foot of suspicions by the Automobile Association's sister bodies that oil prices in Europe had been significantly higher than world prices on three occasions in the last year, said AA director of policy Conor Faughnan.
European wholesale oil prices were "way out of sync" with the global market at the start of 2012, in September 2012 and in January-February of 2013 in a way that could not be explained by exchange rates or other obvious factors, he said.
EU investigators are probing whether prices reported to the energy ratings agency Platts were distorted by major oil companies and if they colluded to prevent other companies supplying information.
Platts' price information is used by oil companies, wholesalers and retailers in agreeing price contracts for purchases of oil and biofuels. With billions of litres traded each year, even very small price distortions could be worth vast sums.
The impact of price manipulation could have cost drivers thousands over the last decade, according to the Petrol Retailers' Association in the UK.
However, Mr Faughnan said it was too early in the investigation to know if that was the case and it would be impossible to make an accurate estimate of the cost to Irish drivers.
But with two million cars on the road and the average driver using 1,800 litres of fuel a year, adding up to around 3.6 billion litres of fuel per annum in Ireland, any price distortion could add up to massive sums.
An EU Competition Commission spokesperson said that the investigation was at a very preliminary stage and they could not comment further on the implications for motorists or for Ireland.
The commission refused to even confirm the identities of the companies raided.
BP and Shell in Britain and Norwegian-based Statoil along with price ratings agency Platts confirmed they were co-operating with the EU investigation.
The Competition Authority of Ireland said it had not been involved with the investigation so far, as the EU had been looking at oil companies headquartered in other countries.