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Nickle's Daily Oil Bulletin
Canada's latest Oil and Gas industry news
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AME Info | Energy, Oil and Gas
Energy, Oil and Gas news and features
- Iraq to sign $1.2bn deal with China
- Oil falls for a fourth day
- Qatar to cut gas emissions
- Sarco profit rises sixfold
- OPEC likely to cut output, says report
Such incentives to reduce consumption have worked in the past. Fuel taxes imposed after an oil shock in the 1980s are the main reason Europe has a vastly more fuel-efficient car fleet than the United States, said Lawrence Eagles, chief market analyst at the International Energy Agency.
But greater energy efficiency in Europe has also made it harder for Europeans to make further substantial improvements, analysts say.
Yet, the latest price shock has reignited the trend. Moshiur Rahman, a 28-year-old newspaper vendor in London, said higher fuel prices meant that he could no longer afford to drive to work. He now travels more than an hour by train every day.
“I have been sharing a car with a friend but it has just become too much money,” he said. In Warsaw, where gas prices are nearing 5 zloty ($2.31), a liter, Leszek Tumkiewicz tries to leave his Polonez — a fuel-intensive communist-era car — at home. “I drive a lot but I also try to be fond of the Warsaw Metro,” said Mr. Tumkiewicz, 50, a business consultant who lives 12 miles from the city center.
U.S. regulators disclosed a broad nationwide probe into potential oil-market manipulation and said they are expanding surveillance of energy markets.
The move Thursday by the Commodity Futures Trading Commission, including its unusual announcement of an investigation in progress, comes after crude-oil prices topped $130 a barrel last week and tested all-time highs. On Thursday, light, sweet crude for July delivery settled $4.41, or 3.4%, lower at $126.62 a barrel on the New York Mercantile Exchange.
Lawmakers in Congress have been pressing regulators to crack down on manipulation, as politicians seek to demonstrate ahead of the fall elections that they are responding to soaring gasoline prices.
"It's important that people who are paying high gas prices understand the CFTC is on the case and that we're closely monitoring and in this instance deeply investigating any potential abuse in this important energy market," said Bart Chilton, a CFTC commissioner.
Many economists and oil-industry executives say possible shenanigans by market traders have little or nothing to do with the high price of oil. They maintain that the rise is mainly due to fundamental factors such as rising demand, constrained supplies and the weak dollar.
Still, suspicions have lingered that speculators have helped drive oil prices higher. At a series of congressional hearings over the past month, energy consumer groups and some financial insiders have contended that large investments in commodity futures by hedge funds and pension funds are distorting prices.
Congress is weighing proposals to increase collateral requirements for futures traders and otherwise restrain their activities. The implied hope is that such moves will help rein in prices that have almost doubled in a year.
The CFTC's announcement about its oil investigation suggested a single, broad probe that began in December 2007. But people familiar with its enforcement priorities say the agency is pursuing multiple oil investigations, and that many of them relate to one another. CFTC enforcement chief Gregory Mocek said the agency has about 60 manipulation investigations open in various commodity markets.