Comment Text:
O, F. T. O.
OFFIOE'OF THE SEORETARIAT
10-002
COMMENT
CL-02706
April 13, 2010
David.Stawick, Secretary
U.S. Commodity Futures Trading Commission
Three Lafayette Centre
1155 21
St
Street, NW
Washington, D.C. 20581
COtVtlVIENT
Subject:
Comments on Proposed Speculative Position Limits for Energy (File #10-002)
Dear Mr. Stawick:
My name is Dan Averill and I am vice president of Reisner Distributor, a "family-owned" petroleum
marketer serving northwest Washington since 1968.
I am writing today to endorsecomments submitted by the Petroleum Marketers Association of
America and the New England Fuel Institute submitted on April 9, 2010 on the proposed rule to
implement speculative position limits for futures and options contracts for natural gas, crude oil,
heating oil and gasoline. I am also writing to add my own thoughts on this matter to the public
record.
Futures markets were designed as a tool for
bona fide
commercial businesses and end-users to
manage risk and "discover" prices for energy based on supply and demand economics.
Businesses and consumers .rely on these markets and are harmed when they become excessively
volatile or subject to extreme price shocks, as we saw with the 2007-2008 energy bubble. In the
past ten years, such events-have become common and federal regulators failed to take assertive.
action to address the causes and to restore confidence in the energy futures markets.
.By strengthening and passing this proposed rulemaking, the Commission has an opportunity to take
an important @tep in this regard. It will be addressing the main cause of recent market instability -
excessive speculation.
Financial investors, including banks, hedge funds and index funds,
speculate in the energy commodities markets for profit, rather than commodity-related businesses
and users, whodo so to protect themselves from volatility and risk. Speculators take on the dsk
that hedgers seek to shed, however speculation should not dominate the markets. Moreover, one '
speculator or class of speculator should not be allowed to take a large, controlling position in any a
single commodity..
The Commission has a statutory obligation, if not a Compelling moral obligation, to establish hard
limits on .the
size
of positions that speculators can take in these markets, and to bar them from any
exemptions, The rule that has been proposed is not perfect, and again, I strongly urge the technical
improvements suggested by the comments I have written to endorse.
310 Commercial Avenue ¯ Anacortes, WA 98221
(360) 293-2197 PHONE
"
(360) 293-4108 FAX
Serving Western Washington Since 1998
1922 Front Street o Lynden, WA 98264
(360) 354-2169 PHONE o (360) 354-4768 FAX
www.reisnerdistributor.com
500 Kentucky Street ° Bellingham, WA 98225
(360) 734-8800 PHONE ~ (360) 676-6250 FAX10-002
COMMENT
CL-02706
remember the attect tr]at excessive speculation has on businesses like m~ne, my consumers and
the broader economy. It should establish restrictive speculative position limits, and implement them
expeditiously, before we see a repeat of the 2007-2008energy bubble and another major Shock to
a country still recovering from recession.
Thank you for your consideration.
Sincerely,
Dan Averill
Vice President
Reisner Distributor, Inc.
310 Commercial Avenue
PO BOX 409
~nacortes. WA 98221
(360) 293-2197 PHONE
(360) 293-4108 FAX
