Yep. More like "who" than "what's" responsible for what we're paying at the pump. The perps are pretty easy to identify, if you know where to look.
In April, ThinkProgress caused a stir when we uncovered a series of Koch Industries corporate documents revealing the company’s role as an oil speculator. Like many oil companies, Koch uses legitimate hedging products to create price stability. However, the documents reveal that Koch is also participating in the unregulated derivatives markets as a financial player, buying and selling speculative products that are increasingly contributing to the skyrocketing price of oil. Excessive energy speculation today is at its highest levels ever, and even Goldman Sachs now admits that at least $27 of the price of crude oil is a result from reckless speculation rather than market fundamentals of supply and demand. Many experts interviewed by ThinkProgress argue that the figure is far higher, and out of control speculation has doubled the current price of crude oil.
The Kochs' lawyers got a little angry at Think Progress. Think Progress responded with some history.
ThinkProgress has delved into the history of Koch’s oil speculation business and the following timeline spells out Koch’s leading role:
– October 6, 1986: First oil derivative is introduced to Wall Street by traders at Koch. Koch Industries executive Lawrence Kitchen devised the “first ever oil-indexed price swap between Koch Industries and Chase Manhattan Bank.” At the time, such derivatives had been limited to currency markets, and the shift of creating a synthetic financial instrument based on the value of crude oil was revolutionary. For an agreed-upon period, an oil swap is a contract where one party makes payments based on a fixed oil price, and the other party makes payments back based on the changing spot price of oil. In July of 2009, EnergyRisk magazine, a publication for commodity traders, posted a piece exploring the very first oil derivatives and Koch’s role in developing them.– 1990-1992: Koch, along with several oil companies and Wall Street speculators, form a coalition lobbying group to deregulate oil speculation. A coalition called “The Energy Group” is organized to press the Commodity Futures Trading Commission (CFTC) to allow oil derivatives to be traded off the NYMEX or any other regulated exchange....
And it goes on and on.
So yes. You are hereby authorized to chant imprecations against the Kochs and all their kin next time you're squeezing that pump handle and watching the $30's and $40's and $50's speed by so much faster than the gas is going into your tank.
___
Want to get even madder? Try this.
