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U.S. Sues Over Oil-Market Manipulation

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5/25/2011 11:30:00 AM

U.S. commodities regulators have filed a civil lawsuit against two oil traders in Australia and California and three American and international firms over oil market manipulation in 2008, the record-high year for crude prices, the New York Times reported Wednesday.

The suit says that in early 2008 the accused tried to hoard nearly two-thirds of available oil supplies, then abruptly dumped it and collected $50 million, the Times said in a front-page story.

Commodity Futures Trading Commission regulators would not say whether the agency was conducting any other investigations into oil speculation, the paper reported.

President Barack Obama said in April that the Justice Department was “putting together a team whose job it is to root out any cases of fraud or manipulation in the oil markets that might affect gas prices, and that includes the role of traders and speculators.�

The defendants and companies denied to regulators that they manipulated the market, the paper reported.

If the United States proves the claims, the defendants may give up $50 million in profits that were believed to be made as a result of the manipulation and have pay a penalty of up to $150 million, the Times said.

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