WASHINGTON — One is a billionaire financier, and the other operates seven gas stations and convenience stores in a farming community of 7,000 in eastern Washington state.
But George Soros and Gerry Ramm had the same message to the Senate Commerce Committee: Rampant speculation has helped spur out-of-control crude-oil prices.
Soros, whose hedge fund by some accounts made $3 billion last year, talked Tuesday about a “speculative excess” and warned that the run-up in oil prices could drag the United States into a recession.
“There is a strong prima facie case against institutional investors pursuing a commodity-index-buying strategy,” he said. “It is intellectually dishonest, potentially destabilizing and distinctly harmful in its economic consequences.”
Ramm, head of the Inland Oil Co. of Ephrata, Wash., was more plain-spoken. “Excessive speculation on energy-trading facilities is the fuel that is driving this runaway train in crude-oil prices,” he said.
Others testifying at the hearing said speculation by investment banks, hedge funds, institutional investors and others may be responsible for more than half of the skyrocketing price of crude oil. The Federal Trade Commission and others have failed to investigate, they said.
