Markey Asks CFTC About Possible Iranian Manipulation of Oil Prices

False Rumor Reported by Iranian State TV Sent Oil Prices Upward

WASHINGTON (March 14, 2012) – Rep. Ed Markey (D-Mass.) today sent a letter to the chairman of the Commodity Futures Trading Commission, Gary Gensler, asking about a false rumor of a Saudi Arabian pipeline explosion that was first reported on Iranian state television and caused a $3 spike in the price of a barrel of oil on the New York Mercantile Exchange. Commodity analysts have questioned whether this was a deliberate attempt by the Iranian government to inflate oil prices to help offset losses caused by economic sanctions imposed by the United States and Europe.

The CFTC is now developing new rules under the Dodd-Frank Wall Street Reform Act to bring greater transparency to commodity trading and prevent market manipulation, which economists say is contributing to the current high price of gasoline. Markey and other members of Congress also wrote to Gensler two weeks ago after Wall Street trade groups went to federal court seeking an injunction against one of these rules.

“Americans are paying more at the pump because of market manipulation of oil prices, whether it’s by rogue actors such as Iran or by Wall Street speculators,” said Markey, the Ranking Member on the House Natural Resources Committee. “We need stronger protections and aggressive enforcement to prevent this from happening, but Republicans in Congress are trying to stop our financial ‘cop on the beat’ from doing its job. Instead of taking their marching orders from Wall Street lobbyists, Republicans should join Democrats in standing up for American consumers.”

Today’s letter can be found HERE.

Markey specifically asks the CFTC chairman whether the oil markets are susceptible to false rumors; whether the CFTC has investigated the false rumor reported by Iranian state television on March 1; whether the CFTC has identified other similar incidents; and what steps the CFTC is taking to prevent such market manipulation.