Stop oil speculators - the same old argument

The president wants Congress to increase penalties for market manipulation and empower regulators to increase the amount of money energy traders are required to put behind their transactions.

"Congress should do all of this right away," the president said Tuesday during a White House speech in the Rose Garden.

Obama said the plan would put "more cops on the street" to catch speculators who attempt to manipulate markets for their own profit. He also chastised Congress for recently voting against ending tax breaks to U.S. oil companies and said passing his proposal would help members redeem themselves.

Read more: http://www.foxnews.com/politics/2012/04/17/obama-to-pitch-52m-plan-to-regulate-oil-markets/#ixzz1sJv8tIBp

It is an election year, so candidates have to find villains. In this case, the villains are oil speculators. The high price of oil, similar to research in 2008, is associated with the workings of supply and demand. It is a global energy market and the price of oil is determined by demand outside the US as well as inside. In fact, the price of Brent oil is much higher than WTI. The price for refiners in the Mid-continent is much lower than in other parts of the world. Is this manipulation? Is it manipulation if there are refinery shutdowns in the Northeast which pushes up the price of gasoline? Is it manipulation if there is reversal of oil pipelines to bring oil to the Gulf coast for export? Is it manipulation when there is geopolitical risks in the Middle East or thee is productions shutdown in the North Sea? 

There is a need for review and regulation of speculations but that issues may have nothing to do with the price of oil or gasoline in the current environment.