June 10, 2011
I am writing to you regarding the upcoming roundtable discussion on June 16, 2011, regarding proposed dealer and major participant definitions under the Dodd-Frank Act.
I hope that you and the CFTC can use that discussion to help curb the excessive speculation in oil and oil futures; speculation which is largely responsible for the current rise in oil and gasoline prices. I fervently pray that you will work to close the loopholes, improve oversight and increase transparency in the oil and commodity markets.
In 2008, when gasoline prices first breached $4.00 per gallon, I became curious as to why the price of oil and gas was going so high so fast. The mainstream news media was of little help because conflicting reports. So, I began researching the commodities market on my own; usually through financial news and reports from organizations such as the Energy Information Administration, Bloomberg.com, Reuters.com and the Associated Press. My research reveals that "supply and demand" plays only a minor role in the price of oil and gas. Current supplies of oil have increased beyond historical levels. Concomitantly, demand has dwindled.
Although OPEC, currency exchange rates and refiners are factors in the price of oil and gasoline, excessive speculation is, by far, the prime mover.
Please contact me if you have any questions.
Respectfully,
Bill C. Messick