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“Even if we see significant short-run gains in global oil production capabilities, if demand from China and elsewhere returns to its previous rate of growth, it will not be too long before the same calculus that produced the oil price spike of 2007-08 will be back to haunt us again.”
- Dr. James D. Hamilton, Professor, University of California San Diego, Testimony before the U.S. Congress Joint Economic Committee (05.20.09)

“If speculation by long-only index funds did impact commodity futures prices, it is not evident in the empirical evidence available to date. Economic fundamentals, as usual, provide a better explanation for the movements in commodity prices.”
- Dr. Scott H. Irwin, University of Illinois (02.01.09)

“We take the view that all financial markets benefit from having a broad range of participants—providing the overall market remains fair and orderly. In particular, the involvement of a wide range of participants helps support the price formation process and deepens liquidity, which benefits all participants.”
- Memorandum from the Financial Services Authority (FSA) (07.2008)

“The Task Force has found that the activity of market participants often described as “speculators” has not resulted in systematic changes in price over the last five and a half years. On the contrary, most speculative traders typically alter their positions following price changes, suggesting that they are responding to new information – just as one would expect in an efficiently operating market.”
- Interagency Task Force, Interim Report on Crude Oil

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News & Experts > Market Studies

  Date Title
  10/2009 The 2007/2008 Increase in Crude Oil Prices Can Be Explained by “Fundamentals” (PDF)
- Philip K. Verleger, Jr., David Mitchell/EnCana Professor of Strategy and International Management Haskayne School of Business University of Calgary, Calgary, Alberta, Canada
  8/5/2009 The Role of Speculators in Setting the Price of Oil (PDF)
- Testimony of Dr. Philip K. Verleger, University of Calgary, before the CFTC
  3/2009 Anatomy of the 10-Year Cycle in Crude Oil Prices (PDF)
- Philip K. Verleger, Jr., David Mitchell/EnCana Professor of Strategy and International Management Haskayne School of Business University of Calgary, Calgary, Alberta, Canada
  7/2009 Does Speculation Affect Spot Price Levels? The Case of Metals with and without Futures Markets (PDF)
- Dr. George M. Korniotsis, Federal Reserve Board, Division of Research and Statistics
  4/2009 Speculation and Oil Price Volatility (PDF)
- Robert J. Weiner Professor of International Business, Public Policy & Public Administration, and International Affairs George Washington University
  3/2009 Task Force on Commodity Futures Markets Final Report (PDF)
- International Organization of Securities Commissions’ (IOSCO)
  3/2009 An Evaluation of the Influence of Large Reporting Traders on Futures Market Performance
- Informa Economics
  2/2009 Devil or Angel? The Role of Speculation in the Recent Commodity Price Boom (and Bust) (PDF)
- Dr. Scott H. Irwin, University of Illinois
  1/2009 Issues Involving the Use of the Futures Markets to Invest in Commodity Indexes (PDF)
- U.S. Government Accountability Office (GAO)
  10/2008 The Oil Markets: Let the Data Speak for Itself
- EDHEC Business School
  9/2008 Report on Swap Dealers and Index Traders (PDF)
- CFTC Staff
 

“The [Interagency Task Force on Commodity Markets]’s preliminary assessment is that current oil prices and the increase in oil prices between January 2003 and June 2008 are largely due to fundamental supply and demand factors. During this same period, activity on the crude oil futures market – as measured by the number of contracts outstanding, trading activity, and the number of traders – has increased significantly. While these increases broadly coincided with the run-up in crude oil prices, the Task Force’s preliminary analysis to date does not support the proposition that speculative activity has systematically driven changes in oil prices…

If a group of market participants has systematically driven prices, detailed daily position data should show that that group’s position changes preceded price changes. The Task Force’s preliminary analysis, based on the evidence available to date, suggests that changes in futures market participation by speculators have not systematically preceded price changes. On the contrary, most speculative traders typically alter their positions following price changes, suggesting that they are responding to new information – just as one would expect in an efficiently operating market.”

- ITF Interim Report on Crude Oil (7/22/08)
click here to view the full text of this article
 

“The [Interagency Task Force on Commodity Markets]’s preliminary assessment is that current oil prices and the increase in oil prices between January 2003 and June 2008 are largely due to fundamental supply and demand factors. During this same period, activity on the crude oil futures market – as measured by the number of contracts outstanding, trading activity, and the number of traders – has increased significantly. While these increases broadly coincided with the run-up in crude oil prices, the Task Force’s preliminary analysis to date does not support the proposition that speculative activity has systematically driven changes in oil prices…

If a group of market participants has systematically driven prices, detailed daily position data should show that that group’s position changes preceded price changes. The Task Force’s preliminary analysis, based on the evidence available to date, suggests that changes in futures market participation by speculators have not systematically preceded price changes. On the contrary, most speculative traders typically alter their positions following price changes, suggesting that they are responding to new information – just as one would expect in an efficiently operating market.”

- ITF Interim Report on Crude Oil (7/22/08)
click here to view the full text of this article