Securities Law
U.S. Investigates Oil Trading, Despite Unclear Legal Rules
Posted May 30, 2008, 05:37 am CST
By Debra Cassens Weiss
The Commodity Futures Trading Commission has announced it is investigating whether the oil market has been manipulated by energy traders.
Sources told the Wall Street Journal the agency is pursuing multiple oil investigations, many of them related. The CFTC regulates a market that is subject to different regulations than securities trading and where illegality isn’t as clear, according to the article (sub. req.).
One investigation concerns whether traders distorted crude-oil prices by flooding a price-reporting system run by a unit of McGraw-Hill Cos., and then used the distorted prices to profit in other market trades. Another investigation focuses on similar activity in jet-fuel trading.
Yet another probe seeks to find out whether owners of crude-oil storage tanks misrepresent whether the tanks are full, and then make trades to profit on the misleading information.
The article says insider trading generally isn’t illegal in the commodities market, but creating an artificial price to make money can bring charges of market manipulation.
Paul Pantano, a Washington lawyer who represents energy traders, told the newspaper that regulations in the commodities market are open to interpretation. "Commercial parties and speculators are operating in a market where the rules about what is considered manipulative conduct versus legitimate trading activity are not very clear," he said.
Related Stories
- Ex-Mayoral Aide Pleads Guilty in Detroit Text-Message Sex Scandal
Dec 1, 2008, 05:22 pm CST - Durbin Asks Bush to Commute Ex-Governor’s Sentence
Dec 1, 2008, 04:56 pm CST - Bush and Pardon Recipients Share Trait: They’re Supporters of Right to Bear Arms
Dec 1, 2008, 03:49 pm CST - Jurors Clear Lori Drew of Felonies in Landmark Cyberbullying Trial
Nov 26, 2008, 02:38 pm CST
Related Topics
Commenting has expired on this post.
Comments
Posted by Gordon Sutton - 6 months, 2 days, 23 hours, 35 minutes ago
There are those refusing to buy into the so called ‘free-market’ scam and see it for what it really is:
corporate give away at the expense of the rest of the world. Relevant markets have, are, and continue
to be manipulated by corporate globalist. Please, get real.
“What’s good for us is good for the rest” is their doctrine and has always been, as so well stated by the
General Motors Czar, Alfred Sloan of the forties.
Gts