News Releases for June 2008
June 19, 2008
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Hoeven Meets With Chair Of Commodities Future Trading Commission
Governor Presses for Aggressive Regulatory Oversight on Petroleum Market Speculation
BISMARCK, N.D. – Gov. John Hoeven today met with Commodity Futures Trading Commission Chairman Walter Lukken pursuant to a letter he wrote last month urging the CFTC and other federal agencies to investigate petroleum futures trading to prevent market speculation.
The Governor again told the chairman that the commission needs to properly regulate the oil futures trading market to reduce the speculative premium on oil prices.
“Market speculation is creating real hardship for consumers, farmers, business and our economy in general,” Hoeven said. “The government has a proper role in making sure that markets are conducted both fairly and efficiently.”
Lukken indicated that the commission is imposing position limits and reporting requirements similar to the New York Mercantile Exchange (NYMEX) on any international exchange with an access letter from the CFTC to domestic markets.
In addition, Lukken said they have set up an interagency task force, including the Federal Reserve, Energy Department, USDA, and others, to investigate futures trading and exchanges. The group will report back to Congress in September on its findings and recommendations for additional legal and regulatory authority.
In May, Hoeven called on the CFTC, U.S. Energy Secretary Samuel Bodman and the Administration to investigate and take regulatory action in response to speculation in the crude oil market by large hedge funds and other financial investment firms. At the same time, Hoeven asked the Administration to declare a temporary freeze on additions to the Strategic Petroleum Reserve until consumers see relief in the cost of fuel. Congress subsequently passed a bill to do so, which the President signed.
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