WASHINGTON, D.C. — When Congress returns to Washington today after a weeklong breather, the collective grumbling of millions of American motorists will compel lawmakers to prove they're doing something — anything — to fight rising gasoline prices.
So this week, Congress will take on an obscure commodities market. Some oil experts say congressional action could have an immediate impact.
Analysts are increasingly blaming the high prices on excessive oil speculation. They contend that banks and other investors are driving up prices, pushing the cost of a barrel of oil to $60 or $70 beyond its actual value.
Several bills in Congress call for new regulations, more investigators and transparency to let inspectors know who's trading what behind closed doors. The Agriculture Committee will hold hearings to sift through the ideas.
For months now, Congress has been arguing about whether to trim Big Oil's profits, give tax breaks for alternative energy or start drilling along the nation's coastlines.
Meanwhile, oil prices continued to soar, hitting a record of $145 a barrel Thursday at the start of the holiday weekend, as motorists were shelling out more than $4 for a gallon of gas.
"It is no wonder that we hear cries of alarm," said Edward Krapels, a special adviser with Energy Security Analysis of Wakefield, Mass.
U.S. Rep. Bob Etheridge, a North Carolina Democrat, hopes Congress will finally take action.
"One good thing that all this is doing, with all the pain we're getting, it's forcing a lot of folks to be doing some real thinking up here," said Etheridge, who is chairman of a key agriculture subcommittee that oversees oil trading.
Some experts told Congress recently that half the recent jump in oil prices may be caused by excessive speculation.
Speculators are the banks and other investors who buy oil futures on the commodities market -- not to use fuel the way airlines and trucking companies do, but to make profits when their predictions about prices come true.
The market has exploded in popularity. Its trading volume this year is estimated to be nearly six times as much as in 2000.
Much of the trading is regulated overseas, with almost no transparency for United States regulators. So no one here knows who's trading or whether market manipulation and excessive speculation are actually occurring.
There is a flurry of bills in both the House and the Senate -- including one from Etheridge -- that aim to tackle the oil futures market. Among the changes the bills would require:
-- Forcing the government watchdog agency, the Commodities Futures Trading Commission, to hire 100 new regulators. The agency is at the lowest staff level in its 33-year history.
-- Getting rid of the "Enron loophole" that allowed the now-infamous company to manipulate the California energy market.
-- Requiring the trades on the foreign Intercontinental Exchange to be regulated by U.S. investigators. Those trades now make up 30 percent of the market and are overseen by British regulators in what's known as the "London loophole."
-- Increasing reporting requirements to boost transparency about who's trading.
-- Limiting hedge trading and speculating on futures.
-- Raising the "margin requirements," or the down payment, for speculators making bets on the futures market.
Etheridge spent the holiday recess visiting gas stations in Johnston County and the rest of his district, talking up the idea that speculators need more regulation.
"It's the only way I think we can have some quick impact," Etheridge said. Meanwhile, major investment banks such as Goldman Sachs and Morgan Stanley have been lobbying hard to keep themselves in the speculation game, at one point meeting behind closed doors with Democratic staffers on Capitol Hill, according to The Washington Post.
And in the presidential race, both Republican Sen. John McCain and Democratic Sen. Barack Obama have proposals to tackle excessive speculation.
This week, Etheridge will help with hearings in the House Agriculture Committee on whether excessive speculation is wrongly driving up oil prices.
"I do think folks believe there's manipulation, and we want to get to the bottom of it and find out," Etheridge said. "When gas was $2, I thought that was ridiculous. At $4, it's crippling people."
Oil analysts said as much in hearings in late June, where they blamed much of the price run-up on speculators. Meanwhile, business interests insisted that they, too, need relief.
Douglas M. Steenland, president of Northwest Airlines, called for immediate congressional action. He pointed out that eight airlines have shut down since Christmas.
So just before leaving for its Fourth of July recess, the House overwhelmingly passed a bill ordering the Commodities Futures Trading Commission to do its utmost to investigate speculation.
The legislation was little more than symbolic, but it was still powerful, said Michael Greenberger, who served on the regulatory commission in the Clinton administration.
"We need to look at these markets very closely to see what's going on with them," Greenberger said. "My opinion is a meaningful investigation will drain speculation from the markets."
Tyson Slocum, energy director for Public Citizen, an advocacy group in Washington, said there's plenty Congress can do to lower prices, including a push for alternative energy.
And he thinks gas prices could come down at least 50 cents a gallon with more regulation.
"Will all of this happen overnight? No," Slocum said. "But there's a lot that Congress could do to lower prices in the short to medium term."