The CFTC is catching on to the notion that there’s been some speculation in the oil market. WSJ:

Last month, the main U.S. regulator of commodities trading, the Commodity Futures Trading Commission, reclassified a large unidentified oil trader as a “noncommercial” speculator. As a result, the number of futures and options contracts held by traders counted as speculators…rose to 49% of all crude-oil bets outstanding on the New York Mercantile Exchange, up from 38%.

The scale of the recent revision and questions about the reliability and transparency of data in this market are feeding into efforts by Congress to impose restrictions on energy trading. Four Democratic senators on Thursday called for an internal CFTC inspector-general investigation into the timing of a July 22 release of a report led by the agency. That report concluded speculators weren’t “systematically” driving oil prices. Oil prices soared until mid-July…

Talk about shutting the barn door after the horse is long gone. The spike started almost precisely a year ago when the hedge funds saw going long oil was a good way to short the dollar in the risk-free environment created by the Fed, and things got really crazy earlier this year as others piled on. Months ago oil traders and hedge fund managers detailed their findings about speculators in the market. It’s nice that the apparently blinkered CFTC appears to be catching up on the news.

This entry was posted on Friday, August 15th, 2008 at 3:58 pm and is filed under Democrats, General, Republicans, business. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.