The White House unveiled a slate of legislative proposals on Tuesday aimed at cracking down on oil market manipulation, as the administration attempts to combat high gasoline prices.
Some Democrats have blamed rampant speculation in the oil markets for saddling American families with artificially high fuel prices, pressing for more oversight since the historic run-up in commodity prices in 2008.
Traders and some Republicans have cast doubt on the effect speculation has on gasoline prices, however, arguing that increased regulation could actually add to volatility in the markets.
The Obama administration proposals would likely face an uphill battle for passage in the Republican-controlled House of Representatives.
The administration's plan includes:
• Funding for more surveillance and enforcement staff at the Commodity Futures Trading Commission to help monitor oil futures markets.
• Funding for upgrading technology at the CFTC to improve oversight of markets.
• An increase in civil and criminal penalties from $1 million to $10 million.
• Civil fines would be assessed per day, instead of per violation.
• New authority allowing the CFTC to raise margin requirements, or the amount of collateral traders must put up, to address market volatility and prevent excessive speculation.
• Expanding access to CFTC data to get more insight on trends in trading activity from outside experts.
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