American Fuel & Petrochemical Manufacturers President Charles T. Drevna issued the following statement in response to President Obama's plan to increase oversight and crack down on alleged manipulation in oil markets:
<i>To the extent that there is any manipulation in the marketplace, the government should investigate and take corrective actions. Historical data shows speculators are not the primary force impacting prices at the pump. In fact, U.S. refiners count on financial markets to hedge against potentially higher crude oil costs, which work to prevent consumer costs from increasing further.
Announcing steps to strengthen oversight of energy markets, Obama on April 17 called on Congress “to pass a package of measures to crack down on illegal activity and hold accountable those who manipulate the market for private gain at the expense of millions of working families.”</i>
Here are excerpts from a transcript of the president’s remarks on the subject. He spoke in the Rose Garden of The White House. The transcript is from the website of The White House press office:
<i>First, Congress should provide immediate funding to put more cops on the beat to monitor activity in energy markets. This funding would also upgrade technology so that our surveillance and enforcement officers aren’t hamstrung by older and less sophisticated tools than the ones that traders are using. We should strengthen protections for American consumers, not gut them. And these markets have expanded significantly.
Second, Congress should increase the civil and criminal penalties for illegal energy market manipulation and other illegal activities. So my plan would toughen key financial penalties tenfold, and impose these penalties not just per violation, but for every day a violation occurs.
Third, Congress should give the agency responsible for overseeing oil markets new authority to protect against volatility and excess speculation by making sure that traders can post appropriate margins, which simply means that they actually have the money to make good on their trades.</i>
AFPM, the American Fuel & Petrochemical Manufacturers (formerly known as NPRA, the National Petrochemical & Refiners Association) is a trade association representing manufacturers of gasoline, diesel, jet fuel, other fuels and home heating oil, as well as petrochemicals.