Gas prices rising

Gas prices jumped more than 11 cents over the past two weeks, but the pace of higher pump prices has slowed and they may have peaked, according to a survey published Sunday. The average price of a gallon of self-serve regular is $3.88 in the United States, not including Alaska and Hawaii, the Lundberg Survey found. The previous survey three weeks ago found an average of $3.76. The average gallon is just 23 cents off the all-time high of $4.11 set in July 2008, but weakening demand for gasoline and a slower rate of rise in crude oil prices may keep it from hitting that mark, said publisher Trilby Lundberg.

 Well, the federal government is supposed to limit speculation, but so far it hasn’t.

A lot of buying and selling of oil happens on the trading floor, with investment houses, banks, and pension and hedge funds all betting big on oil. They’ll never see the oil they buy and sell. They’re trading paper. It’s not energy, it’s a financial instrument.

“It’s a gambling casino without regulation,” says Sean Cota, the president of the Petroleum Marketers Association which represents gas stations and heating oil dealers.

“They’re going to play the market as much as they can for as long as they can until people say they can’t do it anymore,” says Cota.
And we all feel it at the pump.

The unprecedented upheaval in the Middle East and northern Africa has taken the blame for price increases, but the fact is, there’s been no major change in supply. Other nations are pumping more, making up for the small amount that’s been lost.

Some financial institutions say the run up in oil prices is a function of free market forces — sometimes oil is up, other times down. But a majority of the U.S. Congress didn’t see it that way last year. That’s when it passed, and the President signed, the Dodd-Frank Act, a sweeping financial reform law that called for new regulations that would control some of this speculation and moderate large price swings.