It is time someone got angry about what’s being done to gasoline prices.
And it is past the time that someone explained how much the manipulation of the oil and gasoline markets — by people you probably wouldn’t suspect — is hurting the economy and the folks who live in this country, even our children.
Let me begin by saying: I’m f’ing pissed at the brokers, pension funds, college endowments and all the other big investors that have decided to make the energy markets their sand box.
As you’ve probably heard and undoubtedly noticed, gas prices are nearing $3 a gallon — and it isn’t because we’re driving more.
Quite the opposite is happening. The government’s Energy Information Administration says the recession has caused demand for gasoline to drop sharply to a recent average of 8.955 million barrels a day, way below the 9.298 million barrels of gasoline a day we used back in December 2007.
Oil prices have also been rising steadily and some experts are now predicting $100 a barrel crude in the not so distant future.
This is occurring even though there is so much oil already out of the ground and waiting to be used that storing all the crude could soon become a problem.
And the oil glut isn’t only occurring in this country. The worldwide market is so out of whack that even OPEC Secretary General Abdalla El-Badri felt compelled last week to say that $100 a barrel oil indicates that “something is wrong with fundamentals.”
If fundamentals were the only thing driving prices, gasoline right now would probably be $1 to $1.25 a gallon less at the pump. Look at it another way.
Americans use an estimated 140 billion gallons of gasoline a year. So an extra $1 a gallon added to the price of gasoline because of activity in the financial markets costs the US economy $140 billion in spending power.
If Wall Street allowed the price of gasoline to fall by $1.25 a gallon, that would mean Americans would have an extra $175 billion to spend on other things rather than just filling up their cars.
Ironically, $175 billion a year in unjustified energy costs is about the same amount that Congress and President Obama hope to give Americans in tax reductions.
Those tax cuts come at tremendous cost both politically and economically, since they — along with so many other stimulus moves over the last two years — are causing increases in the federal budget deficit and higher interest-rates.
Peter Beutel, president of the energy risk management firm Cameron Hanover, says the newest culprits in picking American’s pockets aren’t just speculators looking to make a killing on future movements in the price of oil and gasoline.
“It’s pure madness,” says Beutel. “Some big investors are in there buying commodities when they used to be buying shares of companies. And in the process they are driving the underlying price of the commodities higher.”
It’s not just happening in oil.
Corn, cotton — you name it — all sorts of commodities have become the playground of big institutional investors that are, ironically, looking to make money for your retirement, your college or your union.
The problem is, that potential future nest egg is costing you money now.
The solution? Regulators should limit the amount of speculation in the energy markets by big institutional investors like pension funds and college foundations.
If these investors feel the need to have exposure to the energy markets — oh, China will be using so much oil in the coming decade the price has to go up — they can do it the old-fashioned way.
They can buy stock in ExxonMobil, say, so they have a bet in the oil market, or Archer Daniels Midland, for a play in agricultural commodities.
Bona fide speculators should be permitted in the market because they do transfer risk to themselves — in hopes of making a killing — from companies that use energy and can’t tolerate extreme price changes.
But the rule should be that speculators are required to show they have, at times, also been short the energy market — meaning, they aren’t always betting on higher prices.
What can you — as a consumer and voter — do?
Gasoline isn’t the type of product you can stop using. So a consumer boycott is out of the question.
And the way the energy markets are being gamed shows a boycott wouldn’t be effective anyway — as gasoline usage is already down sharply.
But you can call the people who invest your money — your broker, your retirement plan and even the college you attended. See if they are participating in fleecing Ameri can consumers by investing in energy future contracts.
And tell them to stop the nonsense.
You might even try calling your Congress man. Or the Chicago Mercantile Exchange, where energy futures con tracts are traded. Or the US Commodity Futures Trading Commission, which is supposed to — by its own motto — ensure “the integrity of the futures and options markets.”
There’s never a guarantee that anyone will listen. But this much is certain: if you don’t raise a stink, the bastards will keep pushing prices higher in pursuit of profits until there is more pain than this country can endure. jcrudele@nypost.com