The Commodity Market Transparency and Accountability Act (H.R. 6604), sponsored by Agriculture Committee Chairman Collin C. Peterson (D-MN), would have put in place measures aimed at curbing excessive speculation in the energy futures markets with the goal of reducing gasoline prices. The measure received a strong Democrat majority support in a House vote of 276 to 151, but failed on July 30 to receive the two-thirds necessary to pass under suspension of the rules.
Provisions included in the Commodity Markets Transparency and Accountability Act would: require foreign boards of trade to share trading data and adopt speculative position limits on contracts that trade U.S. commodities similar to U.S.-regulated exchanges; require the Commodity Futures Trading Commission to set trading limits for all agricultural and energy commodities, in order to prevent excessive speculation; limit eligibility for hedge exemptions to bona-fide hedgers; codify CFTC recommendations to improve transparency in dark markets by disaggregating index fund and other data in energy and agricultural markets as well as requiring detailed reporting from index traders and swap dealers; authorize CFTC to take action if it finds disruption in over-the-counter markets for energy and gas; and require the CFTC to study the effectiveness of establishing position limits in over-the-counter markets.
A similar bill sponsored by Harry Reid (D-NV), the Stop Excessive Energy Speculation Act of 2008 (S. 3268), has been introduced in the Senate. There is currently an active debate over the role market speculation and the influence large institutional investors are having over current oil prices.
Both efforts have generally found support with state and national trade groups representing petroleum retailers and marketer, such as the Petroleum Marketers Association of America, who have tended support the argument that speculation or other unnatural market influences do exist and are playing a significant role in current oil prices.
A partial solution was found when the recent, massive Farm Bill was passed on June 18 that also worked to close the “Enron Loophole,” which granted an exemption from regulation to electronic energy trading. The measure, strongly supported by the New England Fuel Institute represents a foot in the door, but is seen by some as being only a partial measure towards more rigid oversight.