Thanks, banks!: Wall Street drove up gas prices


Isn't it great that gas prices are finally teetering on normal? Remember the horror movie last summer when parts of the country, especially in the south, saw prices inch toward $5 a gallon?

Turns out Wall Street is to blame for all that pressure at the pump. Last night's 60 Minutes aired a segment looking into how oil could go up to $69 then nearly double to $150 in one year. On September 22, the price of oil jumped $25 in a single day.

The price swings had nothing to do with good ol' fashion supply-and-demand, but the trading of oil on Wall Street. Banks like J.P. Morgan and Merrill Lynch made a killing speculating on the price of oil on the commodities exchange. This $300 billion market came crashing down when the rest of Wall Street exploded. Also, Congress threatening regulations and federal agencies investigating the oil bubble has driven the speculators who drove up prices into hiding. Since then, the price of oil and therefore gas at the pumps has dropped, by a lot.