Where's Oil Money Going? Maybe to Your Pension

Petroleum proceeds boost retirement funds
By Kevin Spak,  Newser Staff
Posted Jul 7, 2008 2:12 PM CDT
In this March 28, 2006 file photo, the Discoverer Deep Seas drillship sits on station off the coast of Louisiana as Chevron drills for oil in the Gulf of Mexico.    (AP Photo/Alex Brandon, File)
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(Newser) – Wall Street brokers and energy speculators aren’t the only ones lining their pockets thanks to skyrocketing oil prices, the Washington Post reports. Many pension funds have pushed heavily into commodities, bringing big returns in a time of economic strife. “Our commodity investment has really helped,” said the executive director of the Fairfax County, Va., pension fund, which has seen a 61% return.

Pension funds dipped into the notoriously treacherous commodity waters after the 2001 market crash, hoping for greater diversity. Now they’re among the biggest in a growing pool of financial industry commodity speculators, but some say they shouldn’t be. “They were never designed for that,” says one hedge fund manager. “When you are buying food and energy commodities, it's affecting people's lives. There are social-justice issues.”