06/05/08 Blame the speculators

The Senate Commerce Committee got an earful the other day from witnesses who say oil futures speculation is the cause for one quarter of the run-up in oil prices. Mark Cooper of the Consumer Federation of America says you're paying ransom at the pump to unregulated oil futures speculators. COOPER "40 dollars for the physical cost of producing crude. 40 dollars for the cartel tax and 40 dollars for speculation. Two thirds of the current price is simply put baloney." The University of Maryland's Michael Greenburger says the just passed farm bill tried to reduce futures speculation but it still allows American oil contracts to trade unregulated on foreign exchanges in Dubai and London. GREENBURGER "If you calculate properly the West Texas Intermediate Market 90 percent of it is dominated by hedge funds, banks, endowments, pension funds, mutual funds, etc. They've taken over." Greenburger urged the Senators to change the law. GREENBURGER "Anybody in the United States trading United States delivered products must be subject to regulation." Do that, says Greenburger and overnight you'd see crude oil prices drop 25 percent. Voice of Idaho Agriculture Bill Scott