Time to act on fuel speculation

I've written before about some of the reasons why fuel prices are currently at record levels, causing some hardship and considerable anger here and around the world.

For me, the least acceptable reason fuel costs so much is that oil is currently the focus of some of the most cynical speculation on the financial markets. Without speculation, oil would be trading at somewhere around $99 a barrel, as opposed to around $140 a barrel at the moment. In other words, some of the richest people in the world are getting even richer speculating on oil prices, driving them up, while we pay for their greed at the petrol stations.

There have already been stirrings in the US Government about clamping down on speculating on oil prices in their NYMEX market, but of course the financial markets are global so for any move to restrict or ban oil speculation we'd need simultaneous action from Tokyo and the London Stock Exchange among others. And even if we could get a global governmental pact to regulate the markets, e-trading could simply move speculation to other, unregulated channels - even e-Bay!

That, however, is not a reason we should not try to sort this out. Let's be clear: nation states need to prove that they are still relevant in tackling problems like fuel scarcity, the credit crunch or environmental degradation.

If they don't we will face a choice between further seepage of power (with or without the consent of we, the people) towards far less accountable pan-national bodies like the European Union, the G8, the World Trade Organisation and the World Bank because only these bodies have the muscle to exercise control over the markets.

The even less appealing alternative is a democratic vaccuum where the market does what it wants unfettered with any issues of social justice, fairness or equity. That's utopia for the money men, but it's the nightmare scenario for the rest of us.