U.S. Rep. John Larson said the cost of a barrel of oil and a gallon of gas no longer reflects supply and demand economics.
Standing beside a group of home heating oil dealers in Hartford Monday, Larson blamed investor speculation for the record increase in energy prices.
“Plain greed is driving the costs up,” he said.
Gene Guilford, executive director of the Independent Connecticut Petroleum Association, said what most people don’t realize is the daily setting of oil prices begins at the commodities exchange. He said investment banks and hedge funds have started telling us supply and demand no longer matter and the commodity price of energy will continue to rise.
Larson said he is going to introduce legislation which will prohibit the participation of speculators in the oil futures market, unless those speculators are able to physically receive a delivery of oil.
John Mitchell of Mitchell Fuel in South Windsor said in his 50-years in the business he’s never seen conditions that have “so flaunted reality in the pricing of the product.”
Mitchell said when Wall Street traders refer to the first cold day of the home heating oil season as “coat day” there’s something “very, very wrong with the system.”
Larson said he doesn’t think this is a partisan issue. “This is not about Democrat or Republican. This is about manipulation of prices,” he said.
He said he expects the financial services industry to oppose the legislation, which he referred to as the Consumer Oil Price Protection Act.