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Since high oil prices are partly a response to normal market forces,
the nation needs to focus on increased energy supplies and
conservation. However, there is another side to this story because
normal market forces are being dangerously amplified by poorly
regulated market speculation.
Twenty years ago, 21 percent of oil contracts were purchased by
speculators who trade oil on paper with no intention of ever taking
delivery. Today, oil speculators purchase 66 percent of all oil
futures contracts, and that reflects just the transactions that are
known. Speculators buy up large amounts of oil and then sell it to
each other again and again. A barrel of oil may trade 20-plus times
before it is delivered and used; the price goes up with each trade
and consumers pick up the final tab. Some market experts estimate
that current prices reflect as much as $30 to $60 per barrel in
unnecessary speculative costs.
www.StopOilSpeculationNow.com
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