An analysis by the Commodity Futures Trading Commission, with help from the Fed, the Treasury and several other government agencies, has come to the same conclusion most economists have–speculators are not driving up oil prices.
Its research “does not support the hypothesis that the activity of these groups is driving prices higher.” Instead the study blames record high oil prices on the usual fundamental factors: rapidly increasing demand combined with lackluster supply growth.
The key finding? Speculative investors most often changed their positions after the oil prices had changed, not before. Hard to find cause and effect there. But we doubt this will stop politicians from scapegoating speculator boogeymen.