Large investment banks and hedge funds were behind skyrocketing prices in oil and natural gas in 2008, according Sen. Bernie Sanders (I-VT), who wants the Commodity Futures Trading Commission (CFTC) to impose immediate position limits.

A sharp critic of the CFTC, Sanders recently leaked confidential data collected by the agency that showed major banks and hedge funds dominating energy markets in 2008 when oil prices rose sharply and topped $140/bbl, pushing gasoline prices at the pump spiked to around $4/gal. Sanders contends that that market dominance continues.

“The American people need action to bring down gas and oil prices and they need it now,” Sanders said.

In a letter to CFTC Chairman Gary Gensler last week, he called on the the agency to hold an emergency meeting to impose strong position limits to curtail speculation in the energy markets. Gensler indicated Thursday that the Commission is likely to consider a final rule on position limits at its next meeting on Sept. 22 (see related story).

“The CFTC has kept this information hidden from the American public for nearly three years. That is an outrage,” Sanders said. “The American people have a right to know exactly who caused…prices to skyrocket in 2008 and who is causing them to spike today. The CFTC claims they need more data to impose speculative position limits” as required by the Dodd-Frank Wall Street Reform and Consumer Protection Act, he noted. “That is laughable.”

The Dodd-Frank reform law required the CFTC to impose strict limits on speculative trading in energy futures market by Jan. 17, Sanders said, adding that the Commission has been in violation of the law for the past seven months.

While complaints have focused mainly on the 2008 price run-up in crude and gasoline prices, natural gas prices also almost doubled from the January 2008 Nymex price of $7.172/MMBtu to $13.105/MMBtu for the July 2008 contract.

Documents posted on the senator’s website, along with a press release advising of “rampant speculation,” include a “snapshot” of positions held in the natural gas futures market on June 30, 2008. The data show seven of the top 10 holders of combined long and short positions on that day are noncommercials: Barclays plc (No. 2 with 608,953 positions), Morgan Stanley (3 with 444,631 positions), JP Morgan Chase (4 with 443,042), George P. Kaiser interests (6 with 366,157), Centaurus Advisors (8 with 360,312), Goldman Sachs (9 with 322,046) and Credit Suisse (10 with 292,169).

Filling in the blanks are commercials BP plc ( No.1 with 679,627 positions), Shell Trading (5 with 423,714), and Sempra Energy Trading (7 with 365,525). High on the list of also-rans are Deutsche Bank with 269,874 positions, T. Boone Pickens with 266,196 positions and CitiGroup with 247,582 positions.

According to the confidential CFTC data leaked by Sanders, an estimated 32 market participants — 24 commercial parties and eight noncommercial parties — had accountability levels in natural gas contracts that were above the individual limit (6,000) or all months’ forward limit (12,000) from December 2007 through the first half of 2008. The eight noncommercial parties were Pickens; Tom L. Ward, CEO of SandRidge Energy; Aubrey McClendon, CEO of Chesapeake Energy Corp.; Centaurus, hedge fund; Citadel, hedge fund ; DE Shaw, hedge fund; Bridgewater Associates, hedge fund (7,489 All Futures and Options Combined); and Stichting Pensionenfonds ABP, a Netherlands pension fund.

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