A US government interagency task force has found that the huge jump in oil prices is due to "supply and demand factors" and that speculators are not to blame for high fuel costs, the Commodity Futures Trading Commission said.
In its interim report, the task force said "preliminary analysis to date does not support the proposition that speculative activity has systematically driven changes in oil prices".
The world economy has expanded at its fastest pace in decades, especially in developing countries like China and India, which has led to substantial increases in oil demand, according to the task force.
"The imbalance between scarce supply and growing demand, and expectations that this imbalance will persist in the future, have led to upward pressure on oil prices and greater market reactions to any actual or perceived disruptions in available supply," the group said in its report.
The task force looked at both supply and demand factors and trading activity in the crude oil futures market from January 2003 through June 2008, when prices steadily increased. The report does not focus just on the markets in the last year, when the price of oil doubled.
US crude oil futures on Wednesday (NZT) fell 2.4% to settle at US$127.95 a barrel, compared with the contract high of US$147.27 hit on July 11.
The task force, which was created in June, is made up of staff members from the Department of Agriculture, the Department of Energy, the Department of the Treasury, the Board of Governors of the Federal Reserve, the Federal Trade Commission and the Securities and Exchange Commission.
The CFTC chairs the panel.
CFTC commissioner Bart Chilton said the panel's findings were "disappointing". He said it was not surprising that the staff of the task force did not contradict their bosses, some of whom have said that speculators are not impacting prices.
"The simple fact remains that there is nearly US$250 billion in America's commodity futures markets that wasn't there just a few years ago," Chilton said.
"There has got to be, to some degree, impact from this significant new influx of trading, and I'm hopeful that a more thorough analysis will thoughtfully look at this question in an unbiased and comprehensive fashion, so that the public is assured these markets are operating in a fair and effective manner for consumers and businesses," he said.
The task force's findings counter many Democratic lawmakers and some energy experts who argue that the billions of dollars invested in energy markets by hedge funds, pension funds and other speculators have pushed up oil prices.
The US Senate this week is considering legislation that would rein in excessive oil speculation.
The White House said that, while speculators have caused some of the daily wild swings in energy prices, the "root cause" of high fuel costs is the failure of supply to keep up with growing demand.