After the recent turmoil with Barclay’s rigging the Libor rate, doubts over many other financial markets have been the focus of scrutiny. The G20 has recently commissioned a report by International Organization of Securities Commissions (IOSCO) to look into the oil reporting market.
The initial findings of the report do not make great reading with oil reporting already being flagged as “susceptible to manipulation or distortion.” The findings report that big market players like banks, oil companies and hedge funds have an incentive to distort the oil market with false prices to boost their trade.
With forecourt fuel prices directly linked to oil prices, any manipulation of prices has a direct effect on motorists and businesses, leaving us high and dry while the markets reap the rewards.
A spokesman for the government said: “The important thing is that we have efficient and fair markets. If there is evidence that any market is being manipulated, that is a matter for the regulators and those regulators should look at it very carefully.”
The report is still in its initial stages but we’ll keep you updated as an when further findings are released into the public domain.