Here's an interesting article about testimony given about gas prices and speculation

[JohnWxy]

this is from June 2008, but the price of gas is comparable this year to what it ran up to in 2008 AND speculation in commodities (and commodity index funds) are still going strong.


http://www.marketwatch.com/story/gas-could-fall-to-2-if-congress-acts-analysts-say">Gas could fall to $2 if Congress acts, analysts say Limiting speculation would push prices to fundamental level, lawmakers told

Testifying to the House Energy and Commerce Committee, Michael Masters of Masters Capital Management said that the price of oil would quickly drop closer to its marginal cost of around $65 to $75 a barrel, about half the current $135.

Fadel Gheit of Oppenheimer & Co., Edward Krapels of Energy Security Analysis and Roger Diwan of PFC Energy Consultants agreed with Masters' assessment at a hearing on proposed legislation to limit speculation in futures markets.

Krapels said that it wouldn't even take 30 days to drive prices lower, as fund managers quickly liquidated their positions in futures markets.

"Record oil prices are inflated by speculation and not justified by market fundamentals," according to Gheit. "Based on supply and demand fundamentals, crude-oil prices should not be above $60 per barrel."
(more)

http://hsgac.senate.gov/public/_files/052008Masters.pdf">Masters Written testimony before the Committee on Homeland Security and Governmental Affairs - United States Senate

[Skink]

1. Keeping interest rates low encourages speculation.