U.S. News & World Report Mentions ASP Energy Fellow Andrew Holland
U.S. News & World Report recently ran the headline: “Will Obama’s Plan to Enforce Oil Market Regulations Lower Gas Prices?” The topic has gotten quite a bit of discussion, including from ASP’s Andrew Holland. The article starts out with some general information:
President Obama is urging Congress to bolster efforts to better regulate oil markets. On Tuesday, he asked Congress to approve a $52 million plan that includes a six-fold increase for enforcement staff at the Commodity Futures Trading Commission. In addition to putting “more cops on the beat” to oversee the oil market, the president wants to give the CFTC the authority to enforce stricter penalties for businesses that manipulate the oil market, and his plan would fund new technology to provide oversight of the oil market.
To read the full article, click here.
The article then continues with a number of opinion links, with Andrew Holland listed as one of the key voices weighing in on Obama’s plan to lower gas prices by enforcing oil market regulations.
The president is right; speculation does impact the price of gasoline. Unfortunately, he is wrong to think that there is anything that the government can do about it, or that his plan would lower the price of gasoline.
Efforts to reduce the price of oil by targeting “speculators” or “market manipulation” are doomed to fail because oil is a global market set by global changes in supply and demand. Speculation is a natural part of that price because of the uncertainties of future swings in the market. Speculators drive up the price of oil when there is fear of a tight market in the future, but can also push the price down when it looks like supply will exceed demand.
To read the rest of Andrew’s comments, click here.
To read ASP’s new report, Cause and Effect: U.S. Gasoline Prices, click here.
