API's Felmy: Speculators are key in oil markets

The oil and natural gas industry doesn't support the federal government's push to curb speculation on oil markets amid soaring gas prices. "Oil prices have risen for basic supply and demand reasons. Worldwide demand for oil, particularly from China and India, is up while production is flat," said John Felmy, the American Petroleum Institute's chief economist. Speculators are needed in commodity markets "to provide the liquidity that any functioning market requires" to lure investors, Felmy said.

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