Two e-mails landed in my inbox Wednesday night. They arrived within minutes of each other. Both were from airline companies asking me to contact my congressman and visit
www.stopoilspeculationnow.com. Together, the airlines are
blaming oil speculators for high jet fuel prices.
The e-mail letter, signed by a dozen heads of airlines, reads:
Our country is facing a possible sharp economic downturn because of skyrocketing oil and fuel prices, but by pulling together, we can all do something to help now.
For airlines, ultra-expensive fuel means thousands of lost jobs and severe reductions in air service to both large and small communities. To the broader economy, oil prices mean slower activity and widespread economic pain. This pain can be alleviated, and that is why we are taking the extraordinary step of writing this joint letter to our customers.
Since high oil prices are partly a response to normal market forces, the nation needs to focus on increased energy supplies and conservation. However, there is another side to this story because normal market forces are being dangerously amplified by poorly regulated market speculation. [
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What is the story on oil speculation? Find out more from:
National Public Radio: "Oil Speculation Driving up Gas Prices?"
BusinessWeek: "In Praise of Oil Speculation"
News-Sentinel in Fort Wayne, Ind.: "Going After the Speculators Is Just an Oil Distraction"
MSNBC's "The Answer Desk" says:
One quick solution: make speculators put up more money when they buy futures contracts. Under current rules, you can buy large volumes of oil with relatively small amounts of money. By raising the “down payment” on oil futures contracts, the theory goes, you’d eliminate some of the buyers who are just there to place bets.
The problem, as with everything to do with oil prices, is that the oil market is global. So if you shut the door on the U.S. commodity market, speculators could turn to other oil markets — like the International Commodity Exchange in London — to place their trades. If you got all the governments around the world to agree to clamp down (a neat trick if you can pull it off), traders would still figure out how to find each other. They could go on eBay.
