U.S. Rep. Maurice Hinchey plans to introduce legislation this week to crack down on what he calls excessive oil speculation, which he says is driving up fuel prices despite an increase in supply and a drop in demand.
Hinchey, D-Hurley, said his bill is called the "The End Excessive Oil Speculation Now Act." Sen. Bernie Sanders, I-Vt., introduced a Senate version of the bill earlier this month.
Hinchey held a press conference Tuesday at a Gulf service station on Hooker Avenue in the City of Poughkeepsie to discuss the legislation.
"Supply is greater and demand is lower than it was two years ago," when the price of a gallon of regular gasoline was about $2.44, he said.
The bill would require the chairman of the Commodity Futures Trading Commission to impose position limits and establish a 12 percent margin requirement for speculative swaps and futures trading in crude oil, gasoline, diesel fuel, jet fuel.
The CFTC is an independent agency created by Congress in 1974 to regulate commodity futures and option markets in the U.S., according to its Web site.
Hinchey, and the Senate version of the bill, cite statements by officials at Exxon Mobil, Goldman Sachs, Delta Airlines and the Saudi Arabian government, that the price of a barrel of oil would be about 20 percent to 40 percent lower, were it not for speculators.
The bill says the supply of gasoline in the Unites States was higher than it was two years ago, and the demand lower, when the price of gasoline was $2.44 a gallon.
City of Poughkeepsie Mayor John Tkazyik joined Hinchey at the press conference.
Gas prices, Tkazyik said, are "restricting the creation of jobs, tourism, and the many other activities that fuel is used for."
Tkazyik said he hopes decreasing fuel prices will lead to a stimulation of the economy.
Steve Kumar, the owner of the Gulf station, thanked the officials at the conference and said it's not small business owners that are setting the high gas prices.
Reach Emily Stewart at estewart@poughkeepsiejournal.com or 845-437-4882.
