Gordon Says Investigation Needed Into Oil Speculation

June 20, 2008

Citing concerns that unscrupulous trading is leading to inflated oil prices, U.S. Rep. Bart Gordon is calling for an investigation into manipulation and speculation in oil energy markets.

Gordon is co-sponsoring H.R. 6238, a bill to investigate market manipulation by energy investors who are trading energy futures like stocks – buying and selling them for profit rather than taking delivery of the product. Many experts say the risky trading from speculators looking for a profit may be artificially inflating gas prices. The U.S. Department of Energy estimates this speculation into oil markets may have added as much as 10 percent to crude oil costs.

“Industries like airlines, trucking companies and refineries use oil futures responsibly to lock in fuel and oil prices to keep their businesses running smoothly,” said Gordon. “But the increase in trading by speculators is risky and reckless, and it may be driving oil prices up by $20 to $30 per barrel.”

H.R. 6238 would require the Department of Energy to establish an interagency working group to identify the factors that affect the price of crude oil and petroleum products. The findings would be reported to Congress to determine if more oversight is needed to protect the integrity of the energy markets.

The working group would include members from the Federal Trade Commission and the Federal Energy Regulatory Commission, and it could include representatives from the Commodity Futures Trading Commission and the Securities and Exchange Commission.

The Energy and Commerce Committee plans to hold a subcommittee hearing on the issue June 24.

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