Manipulated? I thought many here said oil was up based on something called supply and demand, you know something you learn about in economics 101, what a joke, no such thing as supply and demand in this oil market, never has been, never will. Its all manipulated.... US Rep Says Probe Uncovers Oil Market Manipulation Dow Jones June 05, 2008: 01:20 PM EST By Ian Talley Of DOW JONES NEWSWIRES WASHINGTON -(Dow Jones)- The chairman of a Congressional energy panel said Thursday that oil and products markets were being "manipulated" by the biggest trading houses in the futures markets, though he said a probe hasn't uncovered illegal activity. Bart Stupak, D-Mich., named Goldman Sachs (GS) and Morgan Stanley (MS) as two of the trading houses. He said the U.S. House Energy Oversight Committee hasn't subpoenaed the banks and is basing its findings on data from the Commodity Futures Trading Commission. Stupak said initial results of his committee's investigation into skyrocketing oil and product prices had found loopholes in current laws were allowing the biggest traders in the futures market to "game the system." He said the committee would hold a hearing to announce full results of the investigation on June 23. "As our investigation goes further, we are really starting to unravel quite a web of - I am trying to say collusion, but I wouldn't quite go that far - but you can certainly see manipulation of the price in places we've never seen before," he said. Asked if the biggest trading houses were Morgan Stanley and Goldman Sachs, Stupak said: "Yes, it's them," again stressing the lack of any evidence of illegal behavior. "It's not that they are doing anything criminally illegal...they are taking advantage where no one has ever looked before and when someone does take a look, there may be something illegal." Spokespeople at Goldman Sachs and Morgan Stanley couldn't immediately be reached for comment. Stupak said current laws allowed excessive speculation that created artificial prices in energy futures markets. "My subcommittee will continue to identify the driving forces causing excessive speculation in oil markets which has inflated prices to a point where they are no longer tied to the underlying supply and demand theories," Stupak said. The lawmaker made the revelations at a press conference, where he and other congressmen unveiled legislation to curtail speculation in the energy markets. Though many analysts see considerable fundamental support for high oil prices, regulators and legislators alike are increasingly placing the blame for crude's scorching run above $100 a barrel on what they perceive may be excessive financial speculation - a charge that's hard to prove. Unlike stock markets, where trading on information unavailable to the broader market is illegal, commodities markets often turn on proprietary information known to a limited number people. An oil company can take advantage of inside information about its own production outlook when it makes trades. However, if traders intentionally create an artificial price and use it to make money, market manipulation charges may arise. Crude futures have fallen more than $10 from their highs above $135 a barrel, but prices are still dramatically above levels around $66 a barrel a year ago and are up over 30% since the beginning of the year. Crude oil's ascent and gasoline's jump towards $4 a gallon in the U.S. has sparked a chorus of complaints on Capitol Hill and a slew of legislative proposals. At the same time, the CFTC has moved to raise its own profile in overseeing energy markets, increasing reporting requirements from traders and investors and disclosing a broad investigation into crude-oil markets. Congressional aides say any deeper review of the large traders in the energy markets will involve a closer look at the investment banks. Goldman Sachs and Morgan Stanley are major players in the world of commodities, which range from trading to hedging and even owning electricity plants and oil barges. In the first quarter, Morgan Stanley calculated that it took more risks in commodities on a daily basis than in stocks. Stupak said he and other congressman plan to file legislation next week that will target speculation through swap deals, foreign exchanges such as IntercontinentalExchange (ICE), and over-the-counter trades.