Senator Bernie Sanders (I-Vt), the only “socialist” (as he calls himself) in the U.S. Senate, seems to be the only politician speaking out against the “oil speculation” racket being perpertrated on Wall Street…
Sen. Bernie Sanders (I-Vt.) demanded on Thursday that regulators impose limits on oil speculation to help lower the price of gas in a letter sent to President Obama.
“There is mounting evidence that the skyrocketing price of gas and oil has nothing to do with the fundamentals of supply and demand, and has everything to do with Wall Street firms that are artificially jacking up the price of oil in the energy futures markets,” Sanders wrote. “In other words, the same Wall Street speculators that caused the worst financial crisis since the 1930s through their greed, recklessness, and illegal behavior are ripping off the American people again by gambling that the price of oil and gas will continue to go up.”
Last year’s financial reform bill required the Commodities Futures Trading Commission to crack down on commodities speculation by imposing “position limits” — a cap on the size of the bets that Wall Street traders can place. The agency was required to apply the new rules by January 22, but the CFTC has delayed the rules in order to collect data.
“What is particularly offensive is that this could and should have been prevented under current law,” Sanders wrote.
While at least part of the recent spike in oil prices is likely the result of unrest in the Middle East, the heavy volume of Wall Street speculation may be exaggerating the rise, if not driving it outright. The number of speculative bets on food and energy today is even higher than in 2008, when oil reached its highest price ever, sparking food riots across the globe. CFTC Commissioner Bart Chilton has been pushing to implement position limits soon, citing heated speculation and a March 21 research note from Goldman Sachs analyst David Greely that claimed Wall Street gambling in the futures markets is in fact driving up oil prices.
Obama announced a new inter-agency working group to combat fraud in the oil markets on April 21, but some economists and experts believe the effort will have a very limited impact on gas prices. Commodities speculation is perfectly legal, and traders do not have to break the law in order to drive up prices.
Full text of the letter at bottom of article….
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