WASHINGTON, DC – As Americans continue to pay record high gas prices, U.S. Senator Maria Cantwell (D-WA), joined fellow Senators for a hearing on the possible role oil futures market speculation may play in soaring crude oil prices.  At today’s hearing, oil industry experts testified that oil market speculation is likely tacking on $20 to $30 to the price of a barrel of oil, and that current crude oil prices cannot be explained by normal supply and demand dynamics. 

 

“Why in America do we regulate things like corn, hamburger, and orange juice, but when it comes to oil we seem to think that it shouldn’t have the same market transparency functions and oversight as those other products?” asked Cantwell, a member of the Senate Energy and Natural Resources Committee, during today’s hearing. “We cannot let a commodity like energy, which is the life blood of our economy and affects so many other industries, continue to have these loopholes.  Transparency is key to protecting consumers and the price they pay at the pump.”

 

Over the years, Cantwell has worked tirelessly to increase transparency and root out manipulation in the energy markets, including securing anti-manipulation provisions in the Energy Policy Act of 2005 to provide Federal Energy Regulatory Commission (FERC) expanded authority over manipulation in the electricity market.  Cantwell has also cosponsored legislation to help prevent price manipulation and excessive speculation in energy commodity markets that are leading to high energy prices for U.S. consumers.  Currently, some energy commodity markets are exempt from government oversight under the “Enron loophole,” a provision inserted by large energy traders into the Commodity Futures Modernization Act of 2000.

 

Earlier this year, Cantwell authored legislation that would create a federal ban on oil market manipulation, which will prevent Enron-style manipulation schemes in the electricity industry from happening to the oil industry.  Cantwell successfully included her oil market manipulation ban in the comprehensive energy bill the Senate passed last July, and it became part of the House passed energy bill passed earlier this month.

 

In addition, Cantwell introduced bipartisan anti-gas price gouging legislation in May that would empower federal regulators to ensure greater market transparency and go after companies that manipulate oil and gas prices.  It would outlaw gas price gouging at all levels, and give the president the authority to declare national energy emergencies.  Currently, 28 states have similar laws, but a federal ban is needed to truly prevent harmful market manipulation.  The legislation would not preempt these state laws.

 

Cantwell is working with her colleagues on both sides of the aisle to increase America’s energy independence, level the playing field for new renewable and energy efficiency technologies, boost our domestic biofuels industry, and increase the availability of flex-fuel vehicles and biofuel pumps.  Cantwell also believes that the U.S. government—the nation’s single largest energy consumer—must lead the way toward energy independence by adopting the best available fuel efficiency and alternative vehicle technologies to reduce its own petroleum consumption.

 

MP3 file also available at: http://demradio.senate.gov/actualities/cantwell/cantwell071211.mp3

 

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