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Who's to Blame for High Gas Prices? You

July 23, 2008 7:42 AM

ABC NEWS' Dan Arnall reports: The government task force set up in June to ferret out any manipulation in the oil markets has issued an early look at its investigative conclusions. The interim report -- which comes months before the final one -- says that speculators are NOT responsible for the increase in prices.Oil_interagency_report

Some highlights:

* BASIC CONCLUSION: "The Task Force’s preliminary assessment is that current oil prices and the increase in oil prices between January 2003 and June 2008, are largely due to fundamental supply and demand factors."

* WHAT THEY WERE LOOKING FOR TO PROVE SPECULATION: "If a group of market participants has systematically driven prices, detailed daily position data should show that that group’s position changes preceded price changes."

* WHAT THEY FOUND: "The Task Force’s preliminary analysis, based on the evidence available to date, suggests that changes in futures market participation by speculators have not systematically preceded price changes. On the contrary, most speculative traders typically alter their positions following price changes, suggesting that they are responding to new information -- just as one would expect in an efficiently operating market."

* WHAT CAUSED THE HISTORIC RUN-UP IN PRICES: "The world economy has expanded at its fastest pace in decades, and that strong growth has translated into substantial increases in the demand for oil, particularly from emerging market countries. On the supply side, the production of oil has responded sluggishly, compounded by production shortfalls associated with geopolitical unrest in countries with large oil reserves. As it is very difficult to rely on substitutes for oil in the short term, very large price increases have occurred as the market balances supply and demand."

Find the complete report here.

July 23, 2008 | Permalink | User Comments (30)

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Well, using data from http://www.eia.doe.gov/basics/quickoil.html and assuming that Americans paid an extra $1/gallon for approximately 100 days (July 1 - Oct 15), we can roughly say that Americans were robbed of $40 BILLION dollars by the gas price runup. Who took that money from us!!!

Posted by: jimmyHump | Oct 14, 2008 5:55:41 PM

bunch of liars slanting stories any way that suits the monopoly, that's our media working for us! We were robbed plain and simple by the Bushites who are the oil companies.They can cook the books anyway they want,we'll never know the truth but they made us for 40 billion dollars.

Posted by: incredulous | Oct 27, 2008 6:51:21 PM

Wow, I am reading basically a whole bunch of crap. Most of this sounds like regurgitated AP media BS. The solution is simple... baby steps in the same direction we are moving. Contrary to popular belief, it's not all Bush's fault so stop with the BDS. Like most problems in the county it is a culmination of both parties garbage that we the people are paying for.

Posted by: John | Oct 27, 2008 8:40:44 PM

Look folks, it's another episode of "Blame Bush"! Honestly, who are you people going to blame after he is out of office (probably Bush still)? The truth is that 20 years from now Bush will be remembered as one of the greatest presidents. Instead of listening to the media actually research things on your own for a change! Those of you who think Obama will save you are dreaming. Have fun with his redistribution. I hope you like higher taxes!

Posted by: Mark | Oct 27, 2008 8:48:54 PM

This heading of this column is irresponsible and offensive.

Posted by: john | Oct 27, 2008 11:22:41 PM

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