A man pumps gas into his car last week in Los Angeles. (Frederic J. Brown / AFP/Getty…)
Reporting from Washington — With gas prices continuing to soar, 70 members of Congress on Monday pushed federal regulators to stop excessive oil speculation.
The House and Senate lawmakers -- all Democrats -- wrote to the Commodity Futures Trading Commission to urge the agency to immediately put in place limits on traders in crude oil markets and take whatever steps necessary to rein in prices at the pump.
"It is one of your primary duties -- indeed, perhaps your most important -- to ensure that the prices Americans pay for gasoline and heating oil are fair, and that the markets in which prices are discovered operate free from fraud, abuse, and manipulation," the lawmakers wrote in a letter organized by Sen. Bernard Sanders (I-Vt.), who has bee outspoken that speculators are driving up the price of gasoline.
The 2010 financial reform law mandated that the Commodity Futures Trading Commission put position limits on contracts for crude oil, heating oil and numerous other commodities. The agency approved restrictions in October, but these have not gone into effect yet and the lawmakers accused commissioners of dragging their feet.
"Although the CFTC has adopted initial position limits, they are not strong enough and not yet in force owing to industry opposition, delays in swaps oversight and data collection. This is simply unacceptable and must change," the letter said. "We have a responsibility to ensure that the price of oil is no longer allowed to be driven up by the same Wall Street speculators who caused the devastating recession that working families are now experiencing."
The lawmakers said it is clear that "excessive oil speculation significantly increases oil and gas prices." But some analysts have said the issue is not so clear and speculation might not have much of an effect.
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