US regulator unveils regulation to curb oil-market manipulations

The Federal Trade Commission (FTC) yesterday approved a new rule that will prohibit manipulations in the wholesale petroleum markets.

The new rule will take effect on 4 November 2009.

Anyone violating the rule will face civil penalties of up to $1 million per violation per day, under the FTC Act.

The rule prohibits actions such as false public announcements of planned output expectations, false statistical or data reporting, and false information about certain types of sale intended to disguise the actual liquidity of a market.

The regulation also prohibits misleading omissions from company statements.

"This new rule will allow us to crack down on fraud and manipulation that can drive up prices at the pump," FTC chairman Jon Leibowitz said in a statement.