Klobuchar, Franken aim to crack down on oil speculation
These days, it nearly takes a Benjamin to fill up.
Amy Klobuchar and Al Franken are sponsoring legislation aimed at reigning in oil speculators.
The average price of gas in Minnesota around $3.73, and similar pump pain being felt throughout the country, there's pressure on lawmakers to do something, anything, to bring prices down.
A group of liberal senators, led by Vermont's Bernie Sanders and including Minnesota's delegation, believes prices could be brought down if the Commodity Futures Trading Commission were forced to quickly implement speculation-combating rules. Problem is, at present it's unclear just what those speculation-combating rules would be.
Consider -- A task force examining oil and gas speculation formed by President Obama last spring has barely met in the year since. In 2010, the commodities trading commission was directed to set rules curbing speculation in energy markets by January 2011, but that deadline passed without anything happening.
The new bill sponsored by Franken and Klobuchar would give the trading commission two weeks to implement new processes for investigating speculators, though it's not clear what the consequences would be if the commission again fails to act.
Forbes recently concluded that speculation adds 56 cents to the price of a gallon at the pump. Franken, citing the fact that Exxon Mobil, Delta Airlines and other major companies support the new bill, said, "the people who spend every day looking at these markets are the ones who say speculators are driving up the cost of gasoline."
Sanders said evidence of speculation's impact is seen in the fact that swings in oil prices seem to violate the laws of capitalism.
"We have more supply than we did three years ago, less demand than since 1997," he said. "If you're looking at the fundamentals of supply and demand, oil prices should be going down, not up."
Get the This Week's Top Stories Newsletter
Every week we collect the latest news, music and arts stories — along with film and food reviews and the best things to do this week — so that you’ll never miss City Pages' biggest stories.