The House of Representatives passed a bill requiring the Commodity Futures Trading Commission (CFTC) to utilize all its authority, including emergency powers, to take steps to curb excessive speculation in the energy futures markets. H.R. 6377, the Energy Markets Emergency Act passed the House overwhelmingly by a bipartisan vote of 402-19.
"A growing number of people believe a flood of speculative money into energy futures is driving the record prices in crude oil," said House Agriculture Committee Chairman Collin C. Peterson of Minnesota during floor debate on the bill. "CFTC must take immediate steps to ensure that index and hedge fund money is not the cause for price manipulation and should take any necessary action to curb excessive speculation in the markets. These steps will help restore consumer confidence and reassure the American taxpayer that the futures markets are functioning properly."
H.R. 6377 directs CFTC to use all its authority, including its emergency powers, immediately to curb the role of excessive speculation in the energy and swaps futures markets and take other corrective actions as necessary to eliminate any market disturbance that prevents energy markets from accurately reflecting the forces of supply and demand.
CFTC is the chief regulator of futures and option markets in the United States. It was created as an independent agency in 1974 with the mandate to enforce and administer the Commodity Exchange Act, to ensure market integrity, to protect market users from fraud and abusive trading practices, and to prevent and prosecute manipulation of the price of any commodity in interstate commerce.
Congressional oversight of CFTC is under the jurisdiction of the House Agriculture Committee, chaired by Congressman Peterson. The Farm Bill, enacted into law earlier this month over the President's veto, reauthorizes CFTC through 2013.
In July, the House Agriculture Committee will examine legislative proposals that would affect CFTC's authority over energy futures and swaps markets. Several bills affecting regulation of the energy futures and swaps markets have been introduced and referred to the Committee in the 110th Congress.
"The Committee will thoroughly and carefully examine legislative proposals that would affect regulation of these markets," Peterson said. "Our review will be comprehensive and public so that we may work toward a consensus, bipartisan bill that will strengthen CFTC's ability to identify fraud and manipulation in the markets."