Press Releases

Washington, DC – U.S. Senator Dianne Feinstein (D-Calif.) today welcomed a new report on oversight of energy trading markets released today by the Commodity Futures Trading Commission (CFTC).

“The Commodity Futures Trading Commission has released a new report underscoring the critical need for increased oversight in U.S. energy markets,” Senator Feinstein said. “There is growing consensus that it’s time for enhanced federal oversight of trading of U.S. oil and gas commodity futures, particularly on electronic trading platforms.

The problem is this: without federal oversight, energy traders have engaged in manipulation and excessive speculation – transforming U.S. energy markets into the Wild West. And cases like Enron and Amaranth only emphasize the cost U.S. consumers have paid for the lack of oversight.

I have long called for increased transparency in U.S. energy markets. So, I am working out the final details of legislation to ensure that the CFTC has the tools it needs to detect and prevent fraud and manipulation in these critical energy markets.  And the findings of the CFTC report are in line with the principles of that legislation.”


Since 2000, there has been a tremendous growth in the trading of oil and gas futures on unregulated, electronic markets.

These electronic trades were exempted from CFTC oversight by a provision inserted at the behest of Enron and other large energy traders into the conference report on the Commodity Futures Modernization Act of 2000.

The lack of oversight in these markets has resulted in billions of dollars of losses:

  • During the Western Energy Crisis in 2000-2001, energy costs for California soared from roughly $8 billion in 1999 to $27 billion in 2000, and then $27.5 billion in 2001. In 2003, the Federal Energy Regulatory Commission (FERC) charged four energy companies – Enron Power Marketing, Enron Energy Services, Reliant Energy Services and BP Energy Company – of engaging in market manipulation.
  • In September 2006, Amaranth Advisers, LLC announced that previously undisclosed speculation in natural gas trading had resulted in a loss of $6 billion. Among other investors who suffered massive setbacks when the hedge fund declared bankruptcy, the County of San Diego lost as much as $87 million in investments set aside for employee pensions. The speculative activity and collapse of Amaranth resulted in inflated natural gas costs. The American Public Gas Association reported massive losses for consumers nationwide at a recent hearing of the Senate Permanent Subcommittee on Investigations.