[Pops]

Help on oil futures trading bill?

I have been traveling and heard a snip about a bill bush is about to sign regarding futures trading, which as the reporter phrased it; will trim up to $30 off a barrel of oil.

I had heard about something similar a while back but nothing recent and I'm not finding much relevant info...

Any links or help?

[Leanan]

Haven't heard anything about Bush signing a bill like that.

However, there's this.

[joewp]

Maybe they're talking about this bull, er bill:

Oil futures Trading delayed in House

$this->bbcode_second_pass_quote('', 'S')nowe’s measure would increase oversight of electronic over-the-counter trading of energy commodities, including oil, natural gas, coal and electricity. Snowe said the legislation is really an attempt to undo language Enron and other large energy traders convinced lawmakers to add to the conference report on the Commodity Futures Modernization Act of 2000.

She called it the "Wild Wild West" of trading.

Before 2000, U.S. energy futures were traded exclusively on regulated markets such as the New York Mercantile Exchange. Since then, most trading has moved to unregulated electronic markets.

"That has to stop," she said. "We have reports that this is part of the reason oil prices have gone up, that it’s more than supply and demand."

Allen co-sponsored similar legislation in the House, but it was not included in the Farm Bill.

U.S. Sen. Susan Collins, R-Maine, also supports the legislation. She said its importance was underscored during a recent hearing by a subcommittee of the Homeland Security Committee on which she serves as ranking member.

"There is a lack of publicly available data to track the effect of speculation on market prices, and manipulation can go undetected on certain unregulated markets," she said. "That is why I support expanding the authority of the federal government to oversee energy futures markets and to provide greater transparency to guard against manipulation."

Collins said the hearings indicated the unregulated trading is one part of the reason energy prices have increased. She said other reasons are increased global demand for crude oil, instability in the Middle East and Venezuela, supply decisions of the OPEC cartel, insufficient U.S. refining capacity and the declining value of the dollar.

[americandream]

Lol...so this is the free market in action...America policing the free global market.......bollix.....

[DantesPeak]

$this->bbcode_second_pass_quote('', '"')We have reports that this is part of the reason oil prices have gone up, that it’s more than supply and demand."

[bonehead]

I'm all for it,I've been watching the futures markets every day for over two years.Not one of their geopolitical catastrophies has come true to the point of really affecting supply.I've seen some minor supply disruptions that last a day or two because of unrest in Nigeria etc.,but nothing that has come close to the supply armageddon that they build into the price.I've also noticed a trend that can best be described as two steps forward and one step back when it comes to these geopolitcal issues.You guys can flame me all you want on this one,but if you think that there's not a helluva lot of greed going on in this system then i've got a bridge in Brooklyn that i'd like to sell ya.

[Pops]

That might be it Joew, I remember the guy saying something about Enron (we were about to miss our flight and I just got a speck).


Actually I used to think that futures market speculation was a rip until Mr. Bill explained it to me. I appreciate the benefit to both producers (cash flow) and raw product purchasers (planning, etc) better now.

In the end though it is the final consumer that sets the price, if the consumer continues to purchase products produced from $100/bbl oil then that is by definition a fair price.


Thanks for the help, I’ll look into this more.