Senator’s Byron Dorgan (D-ND) and Maria Cantwell (D-WA) were part of a group who released a report yesterday which they feel confirms the impact of speculation on energy prices. They hope to use this report to help reinvigorate the debate over whether speculation activities should be curbed by Congress.
The New York Times reports:
Three members of Congress, armed with a new report that they say proves that excessive oil speculation is distorting consumer energy prices, are renewing their efforts to exclude many institutional investors from the nation’s commodity markets.
The report was released Wednesday by Senators Byron L. Dorgan, Democrat of North Dakota, and Maria Cantwell, Democrat of Washington, and Representative Bart Stupak, Democrat of Michigan.
It was written by Michael W. Masters, a hedge fund manager who is urging Congress to curb institutional commodity investments, and Alan K. White, a financial analyst who operates an independent research firm in Alpharetta, Ga.
Using publicly available data, the report argues that institutional commodity investors, specifically through index funds, drive up commodity prices. It says that financial speculators create new demand in limited markets, and it asserts that a retreat of speculative money this summer is responsible for the recent decline in oil prices.
One of the authors of the report, Michael Masters, will attend a Senate subcommittee hearing on the subject of oil speculation next week.
You can read the press release on this report from Senator Dorgan’s office here and Senator Cantwell’s office here.
Congress in Your Pocket
