Speculation adds to oil price surge

Market speculation on energy prices may have added as much as 10 percent to crude oil costs and the peak may be yet to come, a top Energy Department official said Tuesday.

Guy Caruso, head of the department’s Energy Information Administration, told a Senate hearing that supply and demand would suggest a price of about $90 a barrel.


…Caruso said that supply and demand cannot account for all of the recent price surge.

“Something is clearly going on,” he told the Senate Energy and Natural Resources Committee.

Caruso said that in the long run oil prices are forecast to decline, but he acknowledged any short-term predictions are uncertain and prices could increase further.

“I think it’s difficult to say whether this is a peak because there’s so much uncertainty,” said Caruso.

Sen. Byron Dorgan, D-N.D., asked Caruso to explain the recent surge in oil prices.

“I am fairly well convinced that in the short term what we have is an unbelievable orgy of speculation,” Dorgan said.

AP