The Commodity Futures Trading Commission says it launched a nationwide investigation last December into possible manipulation of the oil-markets.
The “Enron loophole” has been around since 2000, when the Commodity Futures Modernization Act was passed.

It lets oil traders buy and sell oil futures contracts electronically in markets outside of the CFTC’s jurisdiction, such as the commodities exchange in London.However, they are not subject to the same CFTC reporting requirements.

Essentially what’s going on here is oil traders of U.S. crude now can make electronic trades in offshore markets. US “computer terminals will be governed by US regulation, because the computer terminal is located in the United States.”

For now, the CFTC says it struck a deal with the Intercontintental Exchange along with Britain’s Financial Services Authority to get more daily trading data on large trader positions in oil futures made on the ICE Futures Europe platform.

ICE oil futures are traded electronically on computer terminals across the US, using prices linked to oil futures trades on the New York Mercantile Exchange.

However, they are not subject to the same CFTC reporting requirements.

Whether any of this legislation will lower oil prices is unclear at this moment, as China and India suck up oil at record amounts and OPEC refuses to ramp up production (don’t you wonder whether OPEC members are saying to themselves, why invest in Citigroup or Merrill Lynch when we can let oil sit in the ground as oil will continue to rise?)

A stronger dollar would help, too, as the debasement of the US dollar has caused oil, traded in dollars, to rise. A rising dollar may have helped push oil prices lower Thursday, as crude futures for July delivery fell $4.41 to $126.62 a barrel in New York futures trading.