Energy Speculators In the Bullseye

If there were about a thousand people in special colored coats who could be rounded up from trading floors around the world and run out of town on a rail, it would be oil futures market "speculators" who are being blamed for running up the price of oil.

"Causing this rise in the cost (of oil) has been unbridled speculation," said Rep. John Larsen (D-CT.)

"It has taken on an almost casino atmosphere," he added.

Members of both parties have joined in denouncing these traders and demanding tighter regulations by the Commodities Futures Trading Commission, which has been attacked for not doing enough to keep prices in check.

But as Democrats found out in late June, it's not easy to match the anti-speculator rhetoric and quickly turn that into a bill that can be approved and signed into law.

We have had oil experts who say a few new regulations on such trades could drop oil prices maybe by fifty percent in a short period of time.

That was floated by Michael Masters of Masters Capital Management, who told a number of Congressional committees that regulations were the answer for a quick price fix.

But after initially embracing that idea, Democrats quickly found out that any regulatory efforts could have a downside too, so they will try again to forge a bill after July 4th.

Let me say that anything which even looks halfway like it might work will probably get huge bi partisan majorities in the Congress, as lawmakers in both parties race to identify solutions on high oil and gas prices.

And who are these speculators?  You don't really see anyone, or any companies or any traders named when people talk about it. 

That always make me wonder.

But you were advising political candidates right now on the oil and gas price issue, you would tell them to grab this issue by the scruff of the neck and don't let go.  Point the finger of blame at the speculator!

It will be interesting to see where this issue goes.  I can see the House passing a bill on speculation, but maybe watching it run off the rails in the US Senate.

It all depends on how much pressure lamwakers are getting this week back at home.

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