As the US economy struggles to recover, a sharp spike in gas prices could lead to another economic slump. The prospect is real under a recent Iranian threat to block oil tankers from traveling through the Strait of Hormuz. However the real problem could be oil futures speculators.
It wouldn't be the first time Wall Street oil speculators defied the laws of supply and demand by driving up gas prices ahead of any actual change in availability.
According to a University of Massachusetts Amherst study cited by CBS News, "speculation in the oil futures market is having a big impact on prices at the pump."
Iran's threat to block the flow of one-sixth of the world's oil is in reaction to possible sanctions against the country.
"Western nations are growing increasingly impatient with Iran over its nuclear program. The U.S. and its allies have accused Iran of using its civilian nuclear program as a cover to develop nuclear weapons. Iran has denied the charges," according to USA Today.
Political instability in the Middle East has caused the price at the pump to fluctuate over the past several years. But the Public Interest Research group finds that speculators in the oil futures markets are the real culprits for rising gas prices.
"A decade ago, speculators controlled less than 30 percent of the oil futures market. Today, they control more than 70 percent."
Lawmakers claiming that more oil drilling will stablize American gas prices generally fail to inform the public that oil drilled in the US does not stay in the US.
No matter where oil is pumped, it is sold on the open market and oil futures traders set the prices.