Feds Consider Limits on Oil, Energy Speculation
Commodity Commission to hold hearings on 'purely financial' energy futures trading
By Nick McMaster,  Newser Staff
Posted Jul 7, 2009 2:54 PM CDT
This 2007 photo provided by Shell Exploration & Production Company shows the Frontier Discoverer drilling rig as it sits in Dutch Harbor, Alaska.   (AP Photo)
camera-icon View 2 more images

(Newser) – Federal regulators may impose new limits on the amount of energy-futures contracts that speculators can buy, the New York Times reports, an attempt to curb severe price fluctuations in commodities like oil and natural gas. Oil prices swung from $145 per barrel last summer to $33 in December, movement some attribute to purely financial investors who bet on the direction of price movements.

Gary Gensler, new chair of the Commodity Futures Trading Commission, estimates that such “non-commercial” oil futures buyers made up one-fifth of all trading activity in June. Gensler points out that such speculation on agricultural products like wheat and corn is already limited. The discrepancy between the rules for agricultural and energy futures “deserves thoughtful review” Gensler said.