Lawsuit accuses majors of price manipulation during 2021 winter storm

Protecting Trademark Owners from Price Gouging | Jones Day


Another claim has been leveled against some of the country’s largest energy firms that they manipulated natural gas supplies and prices ahead of the 2021 winter storm that not only hit Oklahoma with devastating effects at the time, but left 200 dead in the state of Texas.

Who’s making the accusation? Former Enron trader CirclesX Recovery, a firm that filed suit in Harris County District Court last month. It sued Energy Transfer, Kinder Morgan, BP, Conoco Phillips and CenterPoint Energy and said they engaged in an Enron-style scheme to cut off gas production or divert supplies into storage days ahead of freezing temperatures that would eventually cripple the Texas power grid reported the Houston Chronicle.

The paper identified Erik K. Simpson as the owner of CirclesX  and a former trading director at Enron. His lawsuit alleged a number of companies informed clients that when gas prices climbed to hundreds times normal levels, they could not make delivery. Such a move allowed them to sell their gas into spot markets, resulting in billions of dollars in profit.

In some respects, the lawsuit is similar to the lawsuit filed last month by Kansas Attorney General Kris Kobach against Macquarie Energy. The $50 million lawsuit accused the firm of manipulation of natural gas markets during the winter storm.

Kobach alleges the firm bought natural gas from the state’s primary supplier at the highest rate ever paid to the company, then passed the inflated costs onto customers.