Oil giant BP America has agreed to pay a civil penalty of $10.75 million to resolve allegations that its company traders manipulated U.S. natural gas prices in 2008, according to a recent filing by the Federal Energy Regulatory Commission (FERC).
The Department of Energy's Office of Enforcement investigated BP’s Southeast Gulf Texas team’s actions between September and November 2008, focused on the oil company’s trading of physical, next-day fixed price natural gas in the aftermath of Hurricane Ike. The investigation focused on whether or not BP manipulated pricing with the intent to depress index prices to benefit larger financial spread positions.
BP paid over $24.3 million in civil penalties in December 2020 for the case, as well as over $250,000 in disgorgement in January 2021. However, BP protested both penalties and filed an appeal to the U.S. Court of Appeals for the Fifth Circuit in February 2021. The case was later remanded back to FERC to reassess the civil penalty.
The case is now officially resolved, and BP will not seek return of the disgorgement it paid in January 2021. In its filing, FERC said that the agreement is “a fair and equitable resolution of the matters concerned” and “reflects the nature and seriousness of the conduct.”
London-based BP has a variety of retail models across the U.S., including company-owned retail stores, strategic partnerships, brand licensing, wholesale, business-to-business, dealer-owned and franchise-owned locations. Besides its own branded stores and those of the Thorntons arm, BP’s mobility and convenience brands in the U.S. include Amoco, Ampm and the newly acquired TravelCenters of America. Its U.S. headquarters are in Houston.