BALTIMORE (WJZ) — Gas prices are nearing the highest in almost four years—around $4 a gallon. Now the pain at the pump is becoming a political pain for President Barack Obama.
Adam May has more on his plan to stop prices from going higher.
The president wants to stop Wall Street from excessive gambling on the price on the oil and he’s getting support from a well-respected Maryland professor.
“It’s crazy,” said one driver.
“Ridiculous,” said another.
“Pretty expensive,” said a third.
Supply and demand is one reason but Wall Street is another. With crude oil prices above $100 a barrel since February, Obama has called for a crackdown on traders.
“We can’t afford a situation where speculators artificially manipulate markets by buying up oil, creating the perception of a shortage and driving prices higher,” Obama said.
Billions of speculative dollars have been following the oil trading pits. A study by the St. Louis Federal Reserve finds after global demand, “speculation was the second largest contributor to oil prices and accounted for about 15 percent of the rise.”
“High gas prices are a problem of gambling by speculators on Wall Street,” said University of Maryland law professor Michael Greenberger.
Greenberger was a commodities watchdog during the Clinton administration.
“If we could get excessive speculation out of this market, it would be a dramatic surprise to the American people how low the price of gasoline would go,” Greenberger said.
The president’s proposals would have to pass Congress where Republican leaders accuse the Obama administration of failure.
“If he believes the oil markets are being manipulated, where’s his Federal Trade Commission? Where is the SEC?” said John Boehner. “Why doesn’t he put his administration to work to get to the bottom of it?”
We heard a similar proposal from the White House last year but they never issued a report.