Washington (Platts)--27May2008

US Senator Jeff Bingaman, the New Mexico Democrat who is chairman of the
Senate Committee on Energy and Natural Resources, urged the US Commodity
Futures Trading Commission Tuesday to "dig deeper" into the role of
speculators, which lawmakers contend have pushed energy and agricultural
futures prices to record highs this year.

"I recognize that tight oil market fundamentals and geopolitics are
important determinants of global oil prices," Bingaman said in a letter to the
CFTC. "However, I take seriously the testimony of oil industry analysts who
have suggested that supply and demand for physical barrels of oil simply
cannot fully explain today's prevailing oil prices."

Bingaman said the CFTC has discounted the role of speculators in pushing
energy prices higher and that the commission's position that speculators
provide market liquidity is based on a "glaringly incomplete data set."

He said an increasing amount of trade takes place on foreign boards of
trade and in over-the-counter markets, where CFTC has limited data and
oversight capability.

Moreover, Bingaman said he was concerned the CFTC classifies swap
dealers, including large investment banks, as commercial market players -- a
category that also houses physical hedgers such as oil companies and airlines
-- and not as noncommercial participants.

"The practice of including investment banks in the commercial participant
category calls into question the CFTC's continued assertion that
non-commercial participants, or speculators, follow rather than lead oil price
movements," Bingaman said.

Bingaman also said energy traders are not subject to the same
transparency requirements as in agricultural markets.

Since January 2007, CFTC has published a supplemental Commitments of
Traders report detailing the positions of index traders in 12 agricultural
commodities and Bingaman asked why the CFTC cannot launch a similar report
for energy products.

Among other questions, Bingaman urged the CFTC to give the committee by
June 10 information on how much data it receives from the UK's Financial
Services Authority related to ICE Futures Europe's West Texas Intermediate
crude oil contract, whether that data is folded into the CFTC's COT reports
for crude oil, whether or not the CFTC has studied the activity of speculators
in ICE's WTI contract and if the commission is involved in any cross-border
investigation or enforcement efforts regarding energy trading in both US and
international markets.

--Jessica Marron, jessica_marron@platts.com