Politicians Want Speculators To Help Curb Gas Prices
We don’t normally always agree with D.C. politicians–but in this case, they make sense.
While critics say there is much more that could be done to help lower energy and gas prices in the US, some Democrats are calling for Wall Street speculators to stop driving up prices. The Commidity Futures Trading Commission has received a letter from several dozen House and Senate legislators asking for limits to be put on energy futures speculation, which they say is helping to drive up prices. In layman’s terms, if you wonder why oil prices spike when news of Middle East unrest comes out, it’s in part because speculators ‘predict’ potential interruptions or instability with oil supplies and production could cause shortages–leading to higher prices.
Several conservative talk show hosts, including Glenn Beck, and other critics, have pushed for energy futures to be removed from stock market speculation. They say the source of the nation’s infrastructure when it comes to manufacturing, business, transportation and the people (energy) is too important to be ‘playing with’ on the open market. However, speculation is just one of the areas that help drive up energy and gas prices. The other is lack of production, supply, demand, and not enough domestic exploration. In fact, experts say if the Keystone Pipeline had been approved, the price of oil and gas would have dropped considerably because speculators would have realized this huge supply would result in lower prices.