An investigation into whether the distribution of fuels in the Western Isles is anti-competitive has been extended to include Shetland.
The Office of Fair Trading probe was launched into the distribution of road fuels to Western Isles communities in January.
But following pressure from Western Isles campaign group Fair Fuel Solutions, it is being rolled out here as well.
It focuses on the role played by Irish-based fuel company, GB Oils.
The OFT says the investigation is under Chapter II of the Competition Act 1998, and relates to suspected “exclusionary abuses of a dominant position”.
It concerns the contractual arrangements for wholesale supply of road fuels offered by GB Oils – otherwise known as Scottish Fuels – as well as the rebates paid to filling station customers by the company and any other payments that may have been made.
The OFT insists the investigation does not relate to excessive pricing at the pumps. It denies being motivated by a previous review of petrol and diesel pricing which, controversially, claimed rises in pump prices had been caused by higher crude oil prices, and not a lack of competition.
The OFT insists the case is at an early stage and no assumption should be made that there has been an infringement of competition law.
The announcement has been welcomed by isles MP Alistair Carmichael.
He said: “An investigation into the fuel market in the islands is a welcome sign that the OFT may be finally facing up to reality.
“When speaking to local fuel retailers, the lack of competition in the wholesale market comes up time and again.
“I have been disappointed by the OFT in the past as they have never properly looked at the wholesale market in the isles.
“It is now vital that they carry out an extremely thorough review of the situation in Shetland and get to the bottom of this issue.
“This is work that could have been undertaken years ago. I hope that it will now be done thoroughly and professionally, but also as quickly as possible.”
The investigation is expected to conclude in the summer.