After the growing movement of anger against speculative oil trading, have we seen the last major days of buying oil without intent to ever take delivery?

First off, let's get one thing clear- many people have varying opinions on what "speculative trading" really is (or speculation, etc.) One must first understand that there is "speculation" in nearly every investment made. When you invest in a company, you speculate the performance will be to your advantage. (READ MORE!)

My opinion is that oil speculation is trading or buying oil contracts without ever taking delivery- buying oil low, and selling it high, etc. This is the major problem that commodities markets face- traders, banks, and firms analyze the market, and purchase large sums of oil contracts (on paper), and attempt to sell when oil prices push higher. When you have many organizations doing this, it temporarily raises demand of oil contracts, thus raising prices.

The Commodity Futures Trading Commission (CFTC) voted 4-1 to again set limits on energy markets that would decrease the amount of the speculative buyers. The CFTC proposes to restore limits that were last in effect in 2001- the days before oil and gasoline prices became increasingly volatile.

IMPORTANT: The proposal is open for public opinion for the next 90 days, and can be formally adopted after that time, with some changes possible. If you'd like to share your opinion, make sure to send a quality letter outlying your thoughts and concerns to ensure your opinion is heard. E-mail secretary@cftc.gov, and include "Regulation of Retail Forex" in the subject line of the message. Check out the proposal here.

Many organizations point to speculative oil trading as a major reason oil prices rose to a record $147 in 2008, thus pushing the U.S. economy toward a recession. This could result in less volatile energy prices, and many energy intensive industries are pushing for change, and we should too!