The gas market, with its pricing benchmarks based on self-reported transactions, has long been a fertile field for price manipulation. For example, in In re Natural Gas Commodity Litigation, No. 03 CV 6186 (S.D.N.Y. Oct. 14, 2004), plaintiffs alleged that energy companies manipulated the price of natural gas futures contracts by falsely reporting the price and volume of their trades to sources that publish indices of natural gas spot prices. That case settled in 2007 for over $100 million. In re Amaranth Natural Gas Commodities Litigation, No. 07 CV 6377 (S.D.N.Y. July 12, 2007), followed hard on its heels. There, the manipulation scheme involved strategically sized and timed trades designed to influence natural gas prices in a direction beneficial to the defendant hedge fund’s own trading positions. Amaranth settled in 2011 for $77 million.

Recently, the same manipulation techniques seen in Natural Gas have reappeared in California’s gasoline market. On May 4, 2020, California’s Attorney General filed a lawsuit against multinational gasoline traders Vitol, Inc. (“Vitol”), SK Energy Americas, Inc. and SK Trading International (collectively “SK”—a successor to infamous energy company Enron), alleging that they colluded to drive up California gasoline prices for their own profit. The alleged scheme relied on the benchmark gasoline price published by the Oil Price Information Service (“OPIS.”) Each day, traders in California emissions-standard-compliant gasoline voluntarily report their transactions to OPIS. OPIS aggregates the reports to calculate the daily spot price that it publishes in its West Coast Spot Market Report. That daily spot price is the primary component of pricing for both wholesale and retail gasoline sales in California.

The complaint alleges that Vitol and SK (acting through two traders who had previously worked together at Vitol, before one left to join SK) engaged in manipulative trading deliberately engineered to drive up the OPIS spot price. They traded with each other and with third parties for large quantities at uneconomically high prices, and reported those trades to OPIS. These market-spiking trades escaped scrutiny because Vitol and SK opportunistically timed them to coincide with an explosion at a large gasoline refinery in Torrance, California in February 2015, which reduced the supply of gasoline in the California market and provided a plausible cover for the increase in prices. Vitol and SK also limited their own risk by engaging in additional “facilitating trades” that reversed the manipulative, high-priced trades—but without reporting the facilitating trades to OPIS. Their scheme effectively raised the OPIS benchmark price, and, accordingly, California gasoline prices, above competitive levels. The Attorney General’s lawsuit asserts claims for violations of the Cartwright Act (California’s antitrust statute) and California’s Unfair Competition Law.

If your believe you may have been affected by the alleged conspiracy (particularly if you purchased gasoline between 2015 and 2016 pursuant to a supply contract linked to the OPIS spot price), and would like to discuss further, please contact Christian Levis (, Margaret MacLean (, or Charles Kopel (