The Australian government has just announced the intention to introduce new legislation that will require oil companies to no longer share price information.
This raises an important issue. It is hard to imagine government introducing something like that unless it had evidence that the oil companies were indeed sharing price information. So it is a pretty fair assumption that the oil companies have indeed been sharing price information.
Why would oil companies, all competitors with each other, be sharing price information? The is only one plausible explanation - that they are sharing price information in order to collectively set prices? No other possible explanation would make the slightest sense.
Now if the oil companies are sharing information to collectively set prices, that is considered anti-competitive behaviour.
There is a little organisation called the Australian Competition and Consumer Commission. Their entire reason for being is to enforce matters such as the Trade Practices Act. Their remit involves taking action against anti-competitive behaviour. Yet the ACCC has for years allegedly been unable to find any evidence of such behaviour by the oil companies. But it now appears to have been something of an open 'secret' with enough evidence existing to warrant passing of legislation to stamp out the practice.
Just exactly why was the ACCC unable to find the same evidence? Former head of the ACCC, Prof Alan Fels, the man behind the push to remove Parallel Import Restrictions on books, who declared those who opposed the move to be ill-informed and ignorant, was apparently unable to find evidence that was clear enough for others to find.
I have said it before in this blog - just exactly who was the ignorant one, Prof?
The oil companies have been blatantly manipulating prices to suit themselves and engage in price gouging at the expense of the consumer for who knows how long. And the regulator was proven to be completely and utterly useless in combating that situation.
Pathetic. Simply pathetic.