FTC Issues Rule to Block Manipulation of Oil Market

(Bloomberg) — Fraudulent or deceptive actions in the wholesale oil market may draw fines of as much as $1 million a day under a rule issued today by the Federal Trade Commission.

The rule sets definitions for conduct that could manipulate wholesale petroleum markets. It targets false public announcements about planned pricing or output decisions, or false statistical or data reporting, the commission said. So- called wash sales, which are intended to disguise the liquidity of a market or the price of a product, are also prohibited. It takes effect Nov. 4.

Legislation Congress passed in 2007 gave the FTC enhanced authority to curb manipulation. Lawmakers such as Senator Maria Cantwell, a Washington Democrat, pressured the FTC last year to issue the rule after oil hit a record $147.27 a barrel in July.

Bloomberg