Government regulators must quickly implement the recently passed Wall Street reform legislation to prevent the continued manipulation of oil prices. These new regulations must close loopholes, improve oversight and increase transparency in the oil markets.

Speculation Reform Legislation

On July 21, 2010, President Obama signed into law the Restoring American Financial Stability Act of 2010. Passing this legislation was a tremendous victory and should once again allow supply and demand to determine the price of energy – not Wall Street speculators. This law specifically addresses rampant speculation by:

• Establishing tough regulatory oversight of commodity markets
• Increasing transparency by requiring exchange trading and clearing of most energy contracts
• Providing government agencies with the authority to regulate over-the-counter derivatives. This oversight will prevent big banks from manipulating and cornering commodity markets
• Closing known loopholes including the “Enron Loophole” and the “London Loophole”

What’s Next?

Government regulators at the Commodity Futures Trading Commission (CFTC) must adapt the new law into meaningful rules that stop rampant oil speculation. These new rules must reestablish strict position limits on energy commodities without creating new loopholes.

The CFTC announced it could take months to implement new rules because the financial reform legislation included very complicated provisions. These delays could allow Wall Street lobbyists to influence and shape the final rules. In addition, speculators will use this interim period to continue manipulating oil markets.

The S.O.S. Now Coalition will monitor the implementation process to ensure that new rules help you – not Wall Street. You can stay up-to-date on efforts to finalize speculation reform by following us on Facebook and Twitter.