Washington, DC – U.S. Senator Ben Cardin (D-MD) joined a group of senators today to introduce a bill by Sen. Bernie Sanders (I-Vt.) to make federal regulators invoke emergency powers to rein in speculators responsible for rapidly-rising gasoline prices.
The legislation would set a 14-day deadline for the Commodity Futures Trading Commission to implement rules to stop excessive speculation by Wall Street traders in oil futures markets. Cardin joined Sen. Sanders and additional cosponsors Sens. Richard Blumenthal (D-Conn.), Sherrod Brown (D-Ohio), Al Franken (D-Minn.), Amy Klobuchar (D-Minn.) and Bill Nelson (D-Fla.) in introducing the legislation.
The measure was prompted by gasoline prices that are nearing $4 a gallon and the commission’s refusal to obey a Wall Street reform law that required trading limits to be in place by Jan. 17, 2011.
“Oil supply is up and demand is down so there is no logical reason why gas prices continue to soar,” said Cardin. “We need to take decisive action now to stop the speculators who are driving up prices for all of us at a time we can least afford it.”
“Millions of American consumers are hurting as a result of excessive speculation on the oil futures market and the future of our economy hangs in the balance. The time to act is now,” Sanders said at a news conference in the Capitol.
The recent surge in crude oil prices is widely attributed to speculators who control more than 80 percent of the energy futures market, a figure that has more than doubled over the past decade.
Higher oil prices have in turn pushed up the price of gasoline, which stood at a national average of $3.84 per gallon on Tuesday. Supplies are greater today than three years ago, when the national average price for a gallon of gasoline was just $1.94. The demand for oil in the U.S. is lower today than it was in April of 1997.
There is broad consensus that speculators are to blame. Exxon Mobil, the American Trucking Association, Delta Airlines, the Petroleum Marketers Association of America and the Federal Reserve Bank of St. Louis all say excessive oil speculation significantly increases oil and gasoline prices. Citing a recent report from the investment bank Goldman Sachs, a Feb. 27, 2012, article in Forbes said excessive oil speculation adds $.56 to the price of a gallon of gas.
The legislation calling for emergency action is identical to bipartisan legislation that overwhelmingly passed the House of Representatives by a vote of 402-19 during a similar crisis in 2008.