CONGRESSMEN LARSON AND LOBIONDO WITH DOZENS OF OTHERS EXPRESS SUPPORT FOR SPECULATION LEGISLATION
ForImmediate Release/ Contact:Emily Barocas
June26, 2008 202-225-7295/202-593-1377
CONGRESSMEN LARSON AND LOBIONDO WITH DOZENS OF OTHERS EXPRESS SUPPORTFOR SPECULATION LEGISLATION
Washington, DC -- Congressman John B. Larson(CT-01), Vice Chair of the DemocraticCaucus, and Congressman Frank LoBiondo (NJ-2)along with dozens of other members of Congress stood in the shadow of theCapitol today to express bipartisan support for legislation that will reducespeculation in the energy markets and drive down gas prices. The leadership of the House ofRepresentatives has committed to moving such legislation in the month of July.
"The concept of supplyand demand is broken in our oil market," said Congressman Larson. "Oilprices keep skyrocketing to record levels while demand is flat or down. When everyone from the former head of tradingat the Commodities Futures Trading Commission to the Secretary General of OPECand executives from the big oil companies say that speculation is a majorcontributing factor to rising gas prices, it is obvious that we need to dosomething bold."
In 2000 there was $9 billion of investment in oilfutures. Now, that number is up to $250billion. This huge increase is fuelingthe rise in gas prices and making it difficult for average Americans to makeends meet. This type of artificialdistortion of the markets threatens the very underpinnings of our marketsystem.
"From our families toour businesses, everyone is feeling the financial strain from increasing fuelcosts. When we see oil prices spike not because of the demand by consumers, butbecause of the mere speculation by energy traders, then every American should beoutraged and Congress is required to act," said LoBiondo, an originalcosponsor of the legislation.
The Consumer Oil Price Protection Act, H.R. 6264, wouldreduce speculation in the markets by requiring that anyone who is investing inenergy futures on the "dark" markets be able to take receipt of thatproduct. In other words, it would takespeculators out of the unregulated markets and shed some light on theiractivities.
"Many economists haveestimated that excessive speculation is adding between $20 and $50 to the priceof a barrel of oil. We need to closeloopholes and help reestablish oversight of the commodities markets to ensurethat gas prices truly reflect the laws of supply and demand," saidCongressman Baron Hill (IN-9).
Other estimates suggest that speculation contributes up to70% of the cost of a barrel of oil. And,reducing speculation would have a huge impact on the price at the pump.
"Middle classfamilies are suffering at the pump and I am pleased to join with my colleagueson both sides of the aisle in support of this important legislation,"said Congresswoman Shea-Porter (NH-1). "Iam hearing from families who literally cannot afford to drive their kids to thelocal ice cream shop-this is unacceptable. We must work together to get gasprices down."
Congress is committed to acting on this issue. There are plans to hold hearings in therelevant committees over the next few weeks and consider legislation during themonth of July. Speaker Pelosi sent aletter to President George Bush calling on him to direct the CFTC to use itsemergency powers to bring order to the energy markets. And, the House will bring up legislationtoday directing such action.
"Congress must reinin unscrupulous market speculators who artificially drive up the price of oilthrough fear. If no action is taken, what we are seeing now will pale incomparison to the overwhelming burden homeowners will feel this fall and winterwhen they purchase home heating fuel. Americans deserve immediateshort-term price relief and want long-term solutions to our nation's energypolicies. I applaud my Connecticutcolleague, Vice-Chairman John Larson, for his leadership on this issue," saidCongressman Joe Courtney (CT-02).
"The Consumer PriceProtection Act will help curb the uncontrolled speculation in oil markets thatis artificially increasing the price of oil. Market manipulation is unconscionable and is one of the problems we cancombat swiftly," said Congressman Chris Smith (NJ-4).
"Excessivespeculation is driving up energy costs for American families and crippling oureconomy," said Congressman Bart Stupak (MI - 1), chairman of the HouseEnergy and Commerce Subcommittee on Oversight and Investigations and a leaderon this issue. "I have been looking at energy speculationfor three years and just Monday held a seven-and-a-half hour hearing on thetopic. Congress has the facts. Now we must take up comprehensive legislationto close off the loopholes that are allowing speculators to manipulate themarkets."
The dozens of members gathered today stand in support oflegislation that puts the American consumer first and lowers gas prices for usall.
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