Congress takes aim at oil speculators
Posted on June 17th, 2008 by beetlbumjl Categories and Tags: Uncategorized, Air Transport Association, airline industry, Alaron Trading, barrel oil, blunt tool, bureaucracy, Chicago, CNN, Commodity Futures Trading Commission, Congress, crude oil trades, economics, Federal Reserve System, Illinois, inflation, Jim May, Legislative Branch, London, Middle East, New York, News, oil, oil contract, oil contracts, oil futures, oil prices, oil speculation, oil speculators, Oil traders, oil users, Phil Flynn, regulation, Richard Durbin, scarcity, Senate, Stephen Schork, unintended consequences, United States, USA, Wall Street, Walter Lukken 2 Comments »NEW YORK (CNNMoney.com) — Fed up with soaring oil prices and a chorus of people blaming Wall Street speculators, Congress is considering a host of rules aimed at limiting the inflow of investor money into oil contracts.
But oil traders urge caution. While more disclosure is a good thing, they say making it harder for speculators to invest in oil futures could have the opposite effect intended, and send prices higher.
In light of oil’s phenomenal climb from under $50 a barrel to nearly $140 in less than 18 months - and the public belief that Wall Street traders were behind the rise - Congress is awash in bills that attempt to limit the role of speculators. Several have bipartisan support and could soon become law.
“In two days, the price of oil rose $16,” said Sen. Richard Durbin, D-Ill., at a joint hearing of two Senate panels on oil speculation Tuesday. “Did I miss something, was there some war in the Middle East?”
