Document Type
Article
Publication Date
2013
Keywords
oil futures, gasoline prices, futures markets, financial reform, financial derivatives
Abstract
Crude oil prices around the world have oscillated wildly during recent years, and such volatility threatens the fragile economic recovery of the United States and the rest of the world. Although worldwide changes in crude oil supply and demand may be a part of the reason for these fluctuations, the recent financialization of crude oil futures and other commodity staples derivatives markets has exacerbated the price swings and has caused the prices of oil and other commodities to remain artificially high. In order to prevent radically high prices in oil and other commodities, the Commodity Futures Trading Commission (CFTC) and other agencies must strongly enforce such measures as rigorous position limits and anti-manipulation rules as directed by the Dodd-Frank Wall Street Reform and Consumer Protection Act. Legislative bans on derivative-based gambling on crude oil prices will also help in this regard. These actions will help prevent radically high prices in oil and other commodities and restore those markets to pricing determined by market fundamentals, which will in turn avert another global recession or worse.
Journal
81 George Washington Law Review (2013).
Disciplines
Securities Law
Recommended Citation
81 George Washington Law Review (2013).