Should Congress investigate why oil is nearing $70 in a recession?

Is it time for Congress to investigate systematically the futures market for oil?  Market absolutists not cry, but the surge in oil prices $ 70 a barrel in the middle of the worst recession in the United States Since 1982, the first global recession since the Second World War and 10 years of high levels of inventory claims to the contrary .  After reaching a record high of $ 147.27 per barrel during the frenzy of investment and trade in 2008, oil prices collapsed with the emergence of the United States after the recession and the implosion of the financial crisis, the last of which took many hedge funds and investment funds from oil futures market to buyers. Prices have dropped to a low of nearly $ 35 in December 2008.  Historically, $ 30 is a high price of oil  In addition, it is important to note that while oil prices collapsed, $ 35 is still, historically speaking, the price of oil, which has averaged $ 25-30 a barrel in current dollars, more of the last 150 years.  In addition, many experts expect oil prices to recover slowly in 2009. United States reduced demand for gasoline in most of the last 12 months on a weekly basis. Emerging markets demand growth - an important factor in the rise of oil prices in 2003-2007 - has been low, and the world began recording its second consecutive drop in global demand for oil. However, the gradual increase in oil prices does not occur: instead, the price of oil has skyrocketed over the past six weeks, essentially doubling in a very short time, in macro - economic.  Oil bulls say that the futures market of oil, as the stock market is likely that in oil prices, demand conditions six to nine months, where investors and traders make sense in a recession the United States and better international economic environment, and the implied increase in global demand for oil, and rising oil prices accordingly. According to this theory, to $ 70 (or more) the price is justified given the likely evolution of economic conditions.  However, analysts of the oil industry, among others, are more and more investment funds, citing as the main reason for this increase.  "These are funds that are driving the market higher," Jonathan Kornafel, director for Asia of options trader Hudson Capital Energy in Singapore, told Bloomberg News on Friday. "When everybody reads the same report and the conclusion is the same, then you will have the market moving in one direction. The general trend is that the weak dollar and oil to go to get stronger. "  Or in other words, if she is not sure many investors buy oil futures as an alternative - a normal deployment of capital in the open market, and it is a great friendly (except of the speculator or hedger) if you invest in the future of oats or cotton, clearly economist Peter Dawson. However, if the largest asset base - one in which the developed world, and now, much of the developing world - economy depends, in terms of price - the deployment of capital that could become a concern, especially when it is concentrated, Dawson said DailyFinance. At least in theory, the sector concentration of institutional investors in May artificially inflate the price of a quality far beyond what supply and demand determine normal - in fact, severely distorting its price.  "There is no need for conspiracy or collusion to occur. Just concentration," said Dawson. "The concentration is sufficient to cause a bubble in prices, and the U.S. housing sector is one example. There is no "conspiracy" because the median U.S. home prices to match the dizzy heights, but they do take place, and the bubble formed by the merging of actors, in the case of housing A large number of buyers because of the availability of subprime loans. "  Moves the tail the dog?  Dawson said he wants to continue to price in the markets, particularly oil, "but what could happen now is not the price, but" pack mentality. "The U.S. Congress," said Dawson, is expected to begin officially, long-term study on the relationship between the rise in trading futures and oil prices, "and if the systematic study of tens of thousands of new players in oil futures has led to higher prices have been under similar conditions to the offer and demand, with players missing. "  The oil market today - if prices do not moderate in the coming months - is also able to exhibit the characteristics of the border on "The Twilight Zone," said Dawson.  "The problem with the activity of the future, it is pushed prices so high that if one is at a price of $ 60-70, instead of slowing consumer spending and business Crimp budgets to the extent that economic recovery will be injured, "said Dawson. "And if so, the company's future will result in the elimination of the economic recovery that led to the purchase of oil futures in the first place. And when one thinks of this type of market behavior is so absurd and irrational, a point of view of economic development. "  Economics: Oil has vaulted quickly to levels thought possible, given the excess inventory and demand of the tibia. The weak dollar has played a role, but the dollar has fallen by 10-15 percent during the passage of oil to nearly $ 70 - hardly enough to explain the price increase. As economist Dawson, the view from here, said Congress should investigate the relationship between the number of players, and oil futures, oil prices.