Last year.....Obama Blames Oil Spectators for High Oil Prices; April 19th, 2011, remarks by Obama at a town hall meeting.

Now...

17 Apr 2012, Obama needs $52 Million dollars to fund “more cops on the beat” to police Oil Speculators’ activities and keep us safe from those nasty old capitalists. Obama takes exception to speculators making a profit off of buying, holding and selling (at a profit) commodities and stock issues known as “futures”.

Obama can’t figure out a way to blame anybody else at the moment.

While the Commodity Futures Trading Commission (CFTC) does periodically find isolated examples of speculator wrong doing, previous CFTC investigations have found no evidence that oil speculators are artificially driving up the price of oil over the long term.


Heritage’s David Kreutzer explains that the president’s “the speculators did it” argument is flawed on several levels. If speculators are making unconscionable profits on energy, why are they only doing it occasionally and not all the time? Why are there only speculators in oil, not natural gas (whose current price is about half of what it averaged over the last decade)?

Kreutzer writes:

For speculation to drive up prices, the speculators must either cause oil production to slow down (which they haven’t) or to pull oil off the market. If the flow of petroleum and its products remains unchanged, the price at the pump will not change. If petroleum is pulled off the market, which can happen even though there are limits to what can be stored, it will eventually come back on the market.

The question becomes, ‘When the oil comes back on the market, is the price higher or lower than when it was pulled off the market?’ The price will only be higher if the amount supplied at that time is lower or the demand is higher. In either of those cases, speculators have helped moderate price fluctuations and will be rewarded with profits. If the price is lower, then the speculators did a bad thing and will be punished by losing money.

In short, the president’s theory that devious energy speculators are at work driving up the price of oil just doesn’t hold water. So what’s the point of all this? Action for the sake of action, in order to provide a distraction from his failed energy policies.




http://blog.heritage.org/2012/04/18/morning-bell-obamas-new-gas-price-scapegoat/?utm_source=Newsletter&utm_medium=Email&utm_campaign=Morning%2BBell