Are Wall Street speculators driving up gasoline prices?...........thanks Susan
WASHINGTON -- Oil and gasoline prices are rising fast as Memorial Day weekend approaches, but not because supplies are tight or demand is high.
U.S. crude oil inventories are at their highest levels in almost two decades, and demand has fallen to a 10-year low, but crude oil prices have climbed more than 70 percent since mid-January to a six-month high of $62.04 on Wednesday.
Meanwhile, although refiners are operating at less than 85 percent of capacity, leaving them plenty of room to churn out more gasoline if demand rises during the summer driving season, the price of gasoline at the pump has climbed 28 cents a gallon from a month earlier to $2.33.
This time, Wall Street speculators - some of them recipients of billions of dollars in taxpayers' bailout money - may be to blame.
Big Wall Street banks such as Goldman Sachs & Co., Morgan Stanley and others are able to sidestep the regulations that limit investments in commodities such as oil, and they're investing on behalf of pension funds, endowments, hedge funds and other big institutional investors, in part as a hedge against rising inflation.