House Passes Bill Targeting Oil Speculators

The House yesterday approved legislation aimed at curbing speculation in oil and other commodity markets, saying federal regulators don't have the tools or manpower to track trading abuses.

The bill, passed by a vote of 283 to 133 and sent to the Senate, targets certain hedge funds, institutional investors and electronic trading through overseas entities that avoid U.S. government scrutiny.

It would give the Commodity Futures Trading Commission authority to increase staff and limit the stake traders hold in certain markets. It also would require new reporting and other limits on traders, including foreign trading boards.

The bill goes to the Senate, which is considering broader energy legislation focused on offshore oil drilling. It's not certain whether the Senate bill will address commodities speculation.

The White House said in advance of the House vote that President Bush is likely to veto the bill if it reaches his desk. There "is no verifiable evidence to conclude that oil speculators were behind the rise in oil prices . . . [or] were behind its recent decline," said the White House in a message to lawmakers.