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Maria Cantwell at a gas station - 2006 (note the prices) |
Most of us know that gas prices logically are going to go up over time, as supply is limited (even if more oil is pumped) and demand grows. But that's a matter separate from the issue of what gas prices shot up so very high in less than the last year. Nothing about either supply or demand changed all that drastically during that time, so why would prices change so much?
If you're thinking there's some cause for suspicion, you have good reason. If you're wondering whether there's some actual legal recourse potentially available, well, yes, there might be - if the powers that be were willing to use it.
The national spearhead on that might be Washington Senator Maria Cantwell:
Senator Maria Cantwell (D-WA) and Robert McCullough of McCullough Research, a former investigator who exposed Enron’s market manipulation, released a new statistical analysis research report of oil futures and spot market prices. This report shows that the dramatic rise in oil prices in June, and the subsequent fall in price in July, can't be explained by any of the fundamentals of supply and demand. Instead, it could be a result of the trading strategies of major market players. Cantwell and McCullough said new data collection tools are needed so that federal agencies can identify the culprits and stop any market manipulation.
Cantwell plans to introduce legislation when Congress returns in September requiring the Commodity Futures Trading Commission (CFTC), Energy Information Administration (EIA), Federal Trade Commission (FTC) and Federal Energy Regulatory Commission (FERC), to implement new data collection tools.
"Mr. McCullough’s research clearly shows that oil prices are no longer tied to supply and demand,†said Cantwell. “Statistically, this research shows that prices are spiking absent of a crisis like a natural disaster or supply disruption. However, prices then fell when Congress began serious debate on how to crack down on those who may be trying to manipulate the markets. Research shows that traders may well be in control of the market, not supply and demand, and consumers have been left paying the price."
“There is evidence of a troubling concentration of ownership in the oil markets,†said McCullough. “This allows a few players to have undue influence on setting prices. However, the regulators are driving blind through this crisis since they are collecting such little information that reveals who is doing what in the market."