While the Treasury Secretary and the Commodity Futures Trading Commission (CFTC) won't acknowledge that excessive speculation is a big part of the problem, more and more people are reaching the conclusion that excessive speculation is a significant factor in the price Americans are paying for gasoline, diesel and all energy products. "As the price of crude oil has doubled over the past year up 40 percent so far in 2008 more and more people, like the International Monetary Fund and even the Saudi Oil Minister, are coming to realize that speculation has played a significant role in the run-up of oil prices. And the numbers back it up:

"Between September 30, 2003 and May 6, 2008, traders holding crude oil futures contracts jumped from 714,000 contracts traded to more than 3 million contracts. This is a 425 percent increase in trading of oil futures!" Since 2003, commodity index speculation has increased one-thousand-nine-hundred percent, from an estimated $13 billion to $260 billion invested."According to CFTC data, in 2000, physical hedgers businesses like airlines that need to hedge to ensure a stable price for fuel in future months and actually took control of a product accounted for an estimated 63 percent of the oil futures market. Speculators accounted for an estimated 37 percent."By April 2008, physical hedgers only control 29 percent and speculators have taken over a whopping 71 percent of the oil futures market."

Senator Obama announced a plan today to crack down on excessive energy speculation and fully close the "Enron Loophole" to ease the impact of skyrocketing gas prices. The Enron Loophole was created by McCain campaign co-chair Phil Gramm at the behest of Enron, and exempts most over-the-counter energy trades and trading on electronic energy commodity markets from regulation.

In his statement, Senator Obama explained:

For the past years, our energy policy in this country has been simply to let the special interests have their way opening up loopholes for the oil companies and speculators so that they could reap record profits while the rest of us pay $4.00 a gallon. My plan fully closes the Enron Loophole and restores common-sense regulation as part of my broader plan to ease the burden for struggling families today while investing in a better future.The "Enron Loophole" was slipped into law by Senator Phil Gramm in late 2000 at the behest of Enron lobbyists to exempt some energy traders from the regulations and public protections applicable to exchange-traded commodities. As a result, the Commodity Futures Trading Commission (CFTC) is unable to fully oversee the oil futures market and investigate cases where excessive speculation may be driving up oil prices. Many economists believe that the speculation could be adding between $20 and $50 to the price of every barrel of oil..

Senator McCain's campaign has accused Obama of "mimicking" McCain's lead. McCain spokesperson Tucker Bounds says, "John McCain has supported bipartisan efforts to close this loophole and will work to address abuses in oil speculation."

Hmmm. How can you trust McCain's sincerity about closing this loophole when his chief economic advisor is the same Phil Gramm and while he was busy pushing it through Congress his wife sat on Enron's board of directors?

But even before the start to hurricane season, speculative traders have started to send oil and gas prices higher in anticipation of a hit to supplies.

"We're already seeing a hurricane premium on gas of about five to 10 cents per gallon," said Alaron Trading energy analyst Phil Flynn. "Especially since Katrina, we've seen traders build that into prices."

The Colorado State University team's forecast now anticipates 15 named storms forming in the Atlantic basin between June 1 and Nov. 30. Eight of the storms are predicted to become hurricanes, and of those eight, four are expected to develop into intense or major hurricanes. (Credit: NOAA)