Oil giant BP is being questioned over its role in the alleged manipulation of global crude oil and petrol markets between 2002 and 2004.
It said it was co-operating in a crude oil inquiry by the US Commodity Futures Trading Commission (CFTC) and a Justice Department probe into petrol trades.
The investigations will further dent an already fragile reputation in the US.
BP faces questions over its leaky Alaskan oil pipeline and investigations into a fatal Texan oil refinery blast.
'Witch hunt'
Earlier this week, a Texan judge ordered BP chief executive John Browne to answer questions about the huge explosion, which killed 15 people in March 2005.
BP is appealing against the decision.
It is already facing legal action from the CFTC over charges that it tried to manipulate propane prices in 2004.
Energy traders, of which BP is one of the world's biggest, often use derivatives such as futures to bet on prices and manage the risk associated with major rises or falls.
"BP is known for being an extremely aggressive trader of crude, so it's an easy accusation to throw at them," said Bruce Evers, an oil analyst at Investec Henderson Crosthwaite.
"There seems to be almost a witch-hunt going on, with investigations into BP. I'm sure similar charges could be levelled at other companies."
Sunday, June 29, 2008
Open-pit oil trade back in London
'Open outcry' oil trade - in which brokers communicate with traders via a mixture of shouted commands and hand signals - had ended in London in April.
This followed rival firm International Petroleum Exchange's decision to conduct all trading electronically.
Traders said the new exchange gave firms options on how to do business.
Head to head competition
Nymex has been trading Brent crude contracts on an 'open outcry' basis in Dublin since last November.
However, the US company decided to switch the trading floor to London - where the European petroleum market is based - once it had obtained regulatory approval from the Financial Services Authority.
The firm said its decision to introduce pit trading in London was based on customer demand.
"It brings head to head competition to another trading floor and competition is always healthy," Mitchell Steinhause, vice-chairman of Nymex Europe, told Reuters.
"For many of us, open outcry is a way of life. It's our blood."
Level playing field
Nymex said that 59 traders had registered for Monday's launch and that interest in the new exchange was growing.
The IPE switched to electronic trading earlier this year in the belief that the move would reduce overheads and boost trade.
In July, it generated record daily trading volumes of 184,144 contracts, higher than the 181,182 peak recorded in physical trading in September 2004.
Volumes on Nymex's Dublin trading floor peaked at 24,152 daily lots in April before falling to about 4,600 lots currently, according to Reuters.
Traders said regulatory approval was likely to boost interest in the Nymex market.
"What we have got now is a level playing field where clients can trade electronically or open outcry," Steve Lambert, a trader with BNP Paribas, told Reuters.
"I would say that by the end of the month, we will know whether it can work."
The London Metal Exchange is the only other commodities market in London still featuring face-to-face trading.
This followed rival firm International Petroleum Exchange's decision to conduct all trading electronically.
Traders said the new exchange gave firms options on how to do business.
Head to head competition
Nymex has been trading Brent crude contracts on an 'open outcry' basis in Dublin since last November.
However, the US company decided to switch the trading floor to London - where the European petroleum market is based - once it had obtained regulatory approval from the Financial Services Authority.
The firm said its decision to introduce pit trading in London was based on customer demand.
"It brings head to head competition to another trading floor and competition is always healthy," Mitchell Steinhause, vice-chairman of Nymex Europe, told Reuters.
"For many of us, open outcry is a way of life. It's our blood."
Level playing field
Nymex said that 59 traders had registered for Monday's launch and that interest in the new exchange was growing.
The IPE switched to electronic trading earlier this year in the belief that the move would reduce overheads and boost trade.
In July, it generated record daily trading volumes of 184,144 contracts, higher than the 181,182 peak recorded in physical trading in September 2004.
Volumes on Nymex's Dublin trading floor peaked at 24,152 daily lots in April before falling to about 4,600 lots currently, according to Reuters.
Traders said regulatory approval was likely to boost interest in the Nymex market.
"What we have got now is a level playing field where clients can trade electronically or open outcry," Steve Lambert, a trader with BNP Paribas, told Reuters.
"I would say that by the end of the month, we will know whether it can work."
The London Metal Exchange is the only other commodities market in London still featuring face-to-face trading.
Europeon Market Reports: Latest
Germany's Dax index finished flat after earlier breaking above 6,000 and setting a fresh high this year.
The market was weighed by a sharp fall in Mannesmann which closes at its lowest level of the week.
Gains in Deutsche Telekom fail to counter weakness and a poor performance on Wall Street undermined sentiment further.
The Dax was up 0.1% at 5,955.97 after trading in a range between 5,927.78 and 6,032.67.
Mannesmann closed down almost 7% at 193.10 euros after Vodafone AirTouch launched the world's largest hostile takeover bid for the firm.
Paris
The Cac 40 index ended at another record high, the 15th over the past 16 sessions, as France Telecom soared nearly 6% to a new high of 111.90 euros a share and pulled up other blue chips.
The index gained 0.32% to 5263.23 points after erasing earlier losses late in the session. Gainers narrowly led losers 19-17, with three stocks unchanged.
"It's one thing after another, but the market never seems to run out of reasons to climb," one trader said.
The Cac's winning streak started on 28 October and has only been interrupted on Wednesday by a small 0.25% decline.
The blue-chip index seemed to be set for a negative close, but late buying interest was reignited by interest in France Telecom.
"Telefonica made a big impression. People started thinking about how much money this would mean if France Telecom were to float its Internet business," the trader added, commenting on Telefonica's successful floatation of its Internet unit Terra Networks in Spain.
France Telecom is the leading provider of Internet access in France and has been aggressively marketing that sector, prompting three smaller French Internet companies to file an official complaint for unfair competition practices.
Beside France Telecom, most of the action was in the banking sector where Credit Lyonnais gained 2.59% on better-than-expected nine-month results
The market was weighed by a sharp fall in Mannesmann which closes at its lowest level of the week.
Gains in Deutsche Telekom fail to counter weakness and a poor performance on Wall Street undermined sentiment further.
The Dax was up 0.1% at 5,955.97 after trading in a range between 5,927.78 and 6,032.67.
Mannesmann closed down almost 7% at 193.10 euros after Vodafone AirTouch launched the world's largest hostile takeover bid for the firm.
Paris
The Cac 40 index ended at another record high, the 15th over the past 16 sessions, as France Telecom soared nearly 6% to a new high of 111.90 euros a share and pulled up other blue chips.
The index gained 0.32% to 5263.23 points after erasing earlier losses late in the session. Gainers narrowly led losers 19-17, with three stocks unchanged.
"It's one thing after another, but the market never seems to run out of reasons to climb," one trader said.
The Cac's winning streak started on 28 October and has only been interrupted on Wednesday by a small 0.25% decline.
The blue-chip index seemed to be set for a negative close, but late buying interest was reignited by interest in France Telecom.
"Telefonica made a big impression. People started thinking about how much money this would mean if France Telecom were to float its Internet business," the trader added, commenting on Telefonica's successful floatation of its Internet unit Terra Networks in Spain.
France Telecom is the leading provider of Internet access in France and has been aggressively marketing that sector, prompting three smaller French Internet companies to file an official complaint for unfair competition practices.
Beside France Telecom, most of the action was in the banking sector where Credit Lyonnais gained 2.59% on better-than-expected nine-month results
London Market Report : Latest
The London sharemarket was in good health at lunchtime, having topped the 5,600 level, ahead of an expected solid opening on Wall Street.
The FTSE 100 was up 127 points at 5,601on its highs for the day at 1340 GMT.
Hopes of another UK interest rate cut in December have kept London shares well supported.
Investors shook off a mixed batch of company news and gloomy figures from retailers.
There was more bad news on the high street from Storehouse, which is behind the BhS and Mothercare chains.
The group warned its full-year profits were likely to be lower than last year's.
Its shares lost 27p to 135p. Rival Debenhams lost 18½p to 353p.
The FTSE 100 was up 127 points at 5,601on its highs for the day at 1340 GMT.
Hopes of another UK interest rate cut in December have kept London shares well supported.
Investors shook off a mixed batch of company news and gloomy figures from retailers.
There was more bad news on the high street from Storehouse, which is behind the BhS and Mothercare chains.
The group warned its full-year profits were likely to be lower than last year's.
Its shares lost 27p to 135p. Rival Debenhams lost 18½p to 353p.
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