Elizabeth Weyant
Wall Street speculation costs consumers 83 cents a gallon at the gas pump
Media Contacts
New report calls on regulators to stop speculation now
MASSPIRG
Boston, MA—Excessive Wall Street speculation on oil futures translates to an increase of 83 cents a gallon. A new report released by Americans for Financial Reform (AFR) and MASSPIRG entitled How Speculation is Affecting Gasoline Prices Today, calls on regulators to stop excessive Wall Street speculation that is driving up gas prices and costing families money.
The report, authored by Robert Pollin and James Heintz at the University of Massachusetts-Amherst, shows that without the influence of large-scale speculating trading on oil in the commodities futures market, the average price of gas in May 2011 would have been $3.13, rather than $3.96.
“In these tough economic times, rising gas prices are causing hardship for many families,” said Lizzi Weyant, Staff Attorney at MASSPIRG. “Wall Street gambling caused the financial crisis and now Wall Street speculation is increasing gas prices. It’s time for the government to do something about this.”
The average auto owner paid what amounted to a “Wall Street premium” of about $41 in May. For most two-car families, this amounts to nearly $1000 a year. Across the country, the increased cost from speculation totaled 1 billion in May, money that could have been spent on goods and services to generate economic demand and create jobs.
“We have already paid off Wall Street’s debts,” said Weyant. “We can’t let their gambling habits continue to ruin our economy. It’s time for the Commodity Futures Trading Commission act now to help families and the economy. The CFTC should use its authority through the Wall Street reform law to impose strict limits on the amount of oil that Wall Street speculators can trade in the energy futures market.”
A full copy of the report is available online. Americans for Financial Reform will be holding a press conference call with the author at 2pm today. Contact [email protected] or call 202-466-1854 to RSVP for the call.
