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British government to help fund new oil regulator until 2022

Posted on 17 July 2014 by VRS  |  Email |Print

The British government announced on Wednesday another 3 million pounds ($5.14 million) a year in funding for the country’s new oil regulator until 2022, after which it will be fully financed by the industry.
The Oil and Gas Authority (OGA), which will be based in Aberdeen, Scotland, will be responsible for ensuring that oil explorers squeeze as much oil and gas out of Britain’s North Sea as possible. It is expected to start operating later this year………………………………………..Full Article: Source

India: Budget 2014: Gold import duty retained at 10 per cent; bullion markets surprised

Posted on 11 July 2014 by VRS  |  Email |Print

India surprised bullion markets by keeping the import duty on gold and silver unchanged at 10 per cent in its fiscal budget, a move likely to limit overseas purchases by the second-biggest bullion consumer and further encourage smuggling.
Indian gold futures jumped 2 per cent on Thursday, widening the premium over global prices which had narrowed on the expectation of a duty cut. India’s biggest gold trade group had said on Wednesday that the finance minister would likely cut the gold import duty to 6 per cent in the newly elected government’s first budget presentation………………………………………..Full Article: Source

Pentagon uses wrong oil price and fails to hedge fuel bill: Kemp

Posted on 10 July 2014 by VRS  |  Email |Print

The U.S. Department of Defense has been using the wrong oil price in its budget, leaving the largest single buyer of fuel in the world with liabilities potentially hitting billions of dollars. The Pentagon continues to rely on WTI prices even though Brent oil is more relevant to the cost of fuels it buys on behalf of the armed forces.
Using the wrong benchmark has introduced increasing risk into the military budget, according to a critical report published on Tuesday by the Government Accountability Office (GAO) (“Bulk Fuel Pricing: DOD needs to re-evaluate its approach to better manage the effect of market fluctuations”)………………………………………..Full Article: Source

UK watchdog says no evidence that gold price is rigged

Posted on 03 July 2014 by VRS  |  Email |Print

Collusion among banks in setting the gold price benchmark was possible but there is no evidence of this, a senior British regulator said on Wednesday when answering lawmakers’ questions on the trustworthiness of the gold market.
Gold prices and other benchmarks have come under scrutiny, with banks fined $6 billion for rigging the Libor interest rate, used to price a range of financial products. Allegations are also emerging of potential rigging of currency markets………………………………………..Full Article: Source

British MPs urge watchdog to probe price-rigging in gold market

Posted on 03 July 2014 by VRS  |  Email |Print

British MPs have called on the UK’s financial watchdog to investigate allegations of price-rigging in the London gold market after a senior regulatory executive said that there may have been co-ordinated attempts to manipulate a crucial benchmark.
Members of the influential parliamentary Treasury select committee pressed the Financial Conduct Authority to act after hearing evidence on Wednesday from gold market analysts who believe there is scope to rig the daily price-setting process and that it has probably been exploited frequently………………………………………..Full Article: Source

Metals Probe Not a ‘Fundamentally Significant Issue for the Industry’, says BHP

Posted on 03 July 2014 by VRS  |  Email |Print

BHP Billiton Ltd. played down fears that a probe into commodity-backed loans in China would have a lasting effect on the mining industry. Mike Henry, marketing president for BHP, said Wednesday that jitters about the investigation were overblown and that it hadn’t affected BHP or the broader industry “in any serious way.” BHP is the world’s largest miner by market value.
Metal traders recently warned China’s commodity imports could face an extended fall from near-record rates as banks withhold credit and customs officials tighten checks on incoming shipments. That followed allegations a Chinese trading company illegally pledged metals as collateral to more than one lender………………………………………..Full Article: Source

China, Singapore vie for Asia gold pricing alternative to London

Posted on 26 June 2014 by VRS  |  Email |Print

China and Singapore are vying to provide feasible gold price benchmarks in Asia, as calls grow in the top consuming region for more localized pricing of the precious metal at a time when the global benchmark is under regulatory scrutiny.
Singapore said at an industry conference on Wednesday it would launch a physical gold contract on an exchange to create a transparent form of pricing. China, at the same conference, said it wanted to have a bigger influence on the global gold market and would like to have its own price ‘fix’………………………………………..Full Article: Source

US commodities regulator wrestles hedgers and speculators

Posted on 23 June 2014 by VRS  |  Email |Print

A meeting on commodities regulation held in Washington this week at times felt like an argument among lexicographers. The words “hedger” and “speculator” have long had agreed definitions in commodities markets, so much so that the Commodity Futures Trading Commission publishes them in its online glossary.
But as the agency, prodded by the US Congress, attempts to impose a new rule constraining speculators, the yin-yang nature of these two types of traders is blurring into grey………………………………………..Full Article: Source

CFTC rules risk hedging commodities – experts

Posted on 20 June 2014 by VRS  |  Email |Print

A panel of commodities traders have warned the CFTC it could hurt end users. Commodities experts have rallied against a plan by the US derivatives watchdog to limit speculative positions on commodities, arguing the rules would harm legitimate end users who use the products to hedge.
The US Commodity Futures Trading Commission (CFTC) hosted a public roundtable on Thursday comprising all five members of the agency, including the new chairman Timothy Massad. But experts at the roundtable argued that the commission does not understand the complexity of physical commodity hedging, and called for a hedging exemption for corporates and end-users to allow them to manage their risk effectively, free from unnecessary regulation………………………………………..Full Article: Source

Regulator Investigates Controls at Deutsche Bank Commodities Unit

Posted on 20 June 2014 by VRS  |  Email |Print

Germany’s top financial regulator recently investigated internal controls at Deutsche Bank AG’s commodities unit, according to a person familiar with the probe. The regulator, BaFin, sent a letter to the bank outlining its findings in April, this person said. It’s not known whether the regulator found deficiencies in the bank’s processes or instructed the bank to make any changes. It is also not known what prompted the investigation.
Deutsche Bank AG said in December that it would exit most of its commodities trading business. Changes to bank regulations have made it tougher for banks to generate profits from commodities trading………………………………………..Full Article: Source

Forward Markets Commission working on single clearance for commodity exchanges

Posted on 17 June 2014 by VRS  |  Email |Print

The Forward Markets Commission has set up a working group to prepare a roadmap and a structure for a common clearing system for all commodity exchanges in the country in order to reduce transaction costs of market participants and strengthen risk management systems.
The commodity markets regulator announced this in an office memorandum on Monday. The move comes in the backdrop of the payment crisis involving the National Spot Exchange Ltd that broke out in July last year when the exchange could not settle contracts………………………………………..Full Article: Source

China Commodity Loans Add to Surge in Offshore Borrowing

Posted on 13 June 2014 by VRS  |  Email |Print

The commodity-backed loans at the center of a probe into an alleged financial scam at a Chinese port are part of a ramp-up in offshore borrowing by Chinese companies that Beijing is looking to tamp down.
As Chinese authorities tightened credit at home in the past year, local firms instead looked abroad for financing. Asian-Pacific banks alone had $1.2 trillion in loan exposure to China at the end of 2013, up two-and-a-half times from 2010, according to Fitch Ratings………………………………………..Full Article: Source

FMC sets new norms for commodity exchanges

Posted on 13 June 2014 by VRS  |  Email |Print

Commodity market regulator Forward Markets Commission has amended regulations for corporate governance and independent director in commodity exchange. The regulator has now aligned the norms in line with the new Companies Act.
The new FMC norms lays emphasise on appointment of different committees to assist the management take decisions. To start with, it has suggested formation of eight committees, including the one on technology………………………………………..Full Article: Source

Commodities Regulator Names New Enforcement Chief

Posted on 11 June 2014 by VRS  |  Email |Print

Wall Street’s smallest regulator has hired a big-name enforcement director. The Commodity Futures Trading Commission announced on Tuesday that Aitan D. Goelman, a former federal prosecutor turned white-collar defense lawyer, would become the head of its enforcement division. Mr. Goelman, a 45-year-old trial lawyer, will join the agency from the Washington office of Zuckerman Spaeder, where he is a partner.
“He will be a tough, aggressive and fair leader at a critical time in the commission’s history,” Timothy G. Massad, who became chairman of the agency last week, said in a statement………………………………………..Full Article: Source

Worries Hit Commodity Finance Sector as China Opens Investigation

Posted on 10 June 2014 by VRS  |  Email |Print

Is the metal stored in a Chinese warehouse really there? Has the peanut oil shipment that a bank loaned money against been swapped for worthless water? Basic questions like these have begun to play on the minds of traders and bankers doing business in China, the world’s largest importer of raw materials, after an investigation began at Qingdao Port, a huge trading hub in the northeast, into whether more than one license had been issued for the same material.
The duplication, which leaves buyers out of pocket when they claim what they thought was theirs, may be a result of deliberate fraud by a company using the same metal to raise multiple loans………………………………………..Full Article: Source

India commodity regulator seeks more position disclosures

Posted on 05 June 2014 by VRS  |  Email |Print

The commodity markets regulator has launched a fresh attempt to rebuild volume on domestic commodities exchanges, after their credibility was dented by last year’s failure of the National Spot Exchange.
The regulator said it had asked its capital market counterpart to require companies to disclose their commodity trading positions on domestic futures markets, seeing this as a way of boosting the credibility of those markets, in turn boosting activity. Volumes at the commodity exchanges tumbled after NSEL, an exchange run by promoters of the Multi Commodity Exchange defaulted on payments………………………………………..Full Article: Source

Commex norms to be in sync with Companies Act: FMC

Posted on 28 May 2014 by VRS  |  Email |Print

The Forward Markets Commission is considering a slew of measures to improve the governance of and increase participation in the commodities market. “We will come out with board-of-director norms on the same lines as the current corporate governance norms and the Companies Act,” said a senior FMC official.
As a part of these guidelines, FMC will conduct a performance evaluation of all directors, including independent ones, on company boards. Also, independent directors might hold separate board meetings to decide on board decisions that might serve the interest of promoters alone………………………………………..Full Article: Source

U.S. Oil-Export Ban Is Under Review

Posted on 14 May 2014 by VRS  |  Email |Print

Top Obama administration officials are considering relaxing federal laws banning crude-oil exports, a move that would upend decades-old policy, cause a political stir in Washington and sway the global oil market.
U.S. Energy Secretary Ernest Moniz said Tuesday that some of the fast-growing supply of domestically produced oil isn’t suitable for refining locally, which could warrant re-examining a nearly 40-year-old law that bans exports of most crude………………………………………..Full Article: Source

FMC tightens commodity exchange investment norms

Posted on 07 May 2014 by VRS  |  Email |Print

Tightening shareholding norms of commodity exchanges after the National Spot Exchange (NSEL) crisis, the Forward Markets Commission (FMC), on Tuesday, said no resident individual could hold more than 5 per cent stake in them and scrapped the concept of promoters and anchor investors for such bourses.
In an eight-page document laying out shareholding norms for national-level commodity exchanges, the FMC said at least 51 per cent of the shares of any commodity exchange will have to be held by the public. This is to ensure broader participation in commodity bourses………………………………………..Full Article: Source

U.S. commodity regulators looking into banks’ swaps move

Posted on 30 April 2014 by VRS  |  Email |Print

U.S. commodity regulators are inquiring about Wall Street banks’ recent push to remove parent-company backing of some overseas swaps. Scott O’Malia, a Republican commissioner at the Commodity Futures Trading Commission, said in an interview he has asked the agency’s acting chairman, Mark Wetjen, a Democrat, to issue a legal opinion as to whether any of the banks’ exercises have run afoul of the agency’s rules.
On Sunday, The Wall Street Journal reported that banks, including Bank of America Corp., Citigroup Inc., Goldman Sachs Group Inc., J.P. Morgan Chase & Co. and Morgan Stanley, were changing the terms of some swaps made by their offshore units so they could avoid U.S. regulations, according to people familiar with the situation………………………………………..Full Article: Source

Is enough being done to regulate global commodity markets?

Posted on 28 April 2014 by VRS  |  Email |Print

Commodity markets are becoming interconnected, with large global financial investors choosing to invest directly in these markets. With this comes the question of how one is to regulate markets which are truly global, with investors many a time being from outside national regulatory jurisdictions.
All these issues have been acknowledged by the G-20 and governments, and regulations will have to be made keeping in mind the constantly changing trading strategies in commodity markets that are increasingly becoming systemically important………………………………………..Full Article: Source

IEE can determine regional oil price

Posted on 11 April 2014 by VRS  |  Email |Print

Iran Energy Exchange (IEE) has the potential of playing a key role in determining oil price in the region, Managing Director of Iran Energy Exchange Ali Hosseini said on Wednesday.Talking to IRNA, Hosseini noted that since Iran is an oil-rich country, IEE has the potential of increasing supplies from the current 3,000 barrels per day to 10,000 bpd.
“Iran aims to prepare the ground for the presence of foreign buyers of crude oil in the energy exchange and diversify products supplied to buyers, including gas condensate,” he said.The first crude oil transaction at Iran Energy Exchange took place on April 6………………………………………..Full Article: Source

U.S. bank regulator issues bulletin on oil, gas lending risks

Posted on 10 April 2014 by VRS  |  Email |Print

A U.S. regulatory agency on Wednesday issued tips for bankers and examiners on potential risks involved with loans for oil and natural gas production, as the domestic energy boom continues.
The U.S. Office of the Comptroller of the Currency (OCC) published on its website a bulletin laying out supervisors’ expectations for energy production lending and spelling out new examination procedures for banks issuing the loans………………………………………..Full Article: Source

Key senator says U.S. office can lift part of oil export ban

Posted on 03 April 2014 by VRS  |  Email |Print

A U.S. government office has the power to approve exports of an abundant type of petroleum and help energy companies begin to partially bypass a 40-year ban on crude exports, according to a report released on Tuesday by Lisa Murkowski, the top Republican on the Senate Energy and Natural Resources Committee.
The ban on crude exports the government put in place after the Arab oil embargo of the 1970s includes a prohibition on exports of unprocessed condensate, a light petroleum that appears in oil reservoirs as a gas, but condenses to a liquid when it leaves the well…………………………………Full Article: Source

BP warns of regulatory hit to commodities prices

Posted on 02 April 2014 by VRS  |  Email |Print

The head of one of the world’s biggest energy trader has said some of the regulation being imposed on financial markets could have “very worrying” side effects on commodities prices.
Paul Reed, chief executive of BP’s integrated supply and trading division identified a range of new threats from new regulations, including higher capital requirements and a push to using clearing houses to settle trades………………………….Full Article: Source

FMC likely to ease price limits for agricultural commodities soon

Posted on 24 March 2014 by VRS  |  Email |Print

Commodity market regulator Forward Markets Commission may relax the daily price limit for agricultural commodities on the futures platform. This will be in line with that of non-agricultural commodities such as bullion, metals and energy traded on the exchanges.
Currently, agricultural commodities have a maximum daily price limit of four per cent on both the upper and lower sides. In contrast, bullion and other non-agricultural commodities, the first price limit is six per cent. It gets extended subsequently by three per cent, with a cooling period of 15 minutes………………………………………..Full Article: Source

How Obama’s 2015 budget proposal will affect commodities

Posted on 07 March 2014 by VRS  |  Email |Print

Earlier this week, President Obama unveiled his budget proposal for the year beginning October 1. The proposed 2015 budget totals $3.9 trillion, including certain tax increases, as well as budget cuts and increases across nearly all departments. A closer look at the breakdown of Obama’s budget reveals several key factors commodity traders and investors should be aware of — particularly for the energy and agriculture industries.
In the President’s message, Obama stated “We also know that one of the biggest factors in bringing more jobs back is our commitment to American energy… The Budget advances this strategy by ensuring the safe and responsible production of natural gas and cleaner electricity generation from fossil fuels.” In regard to agriculture, however, the President’s outlined budget is significantly smaller than last year………………………………………..Full Article: Source

FCA warns that Euro laws may curtail commodities

Posted on 07 March 2014 by VRS  |  Email |Print

Four incoming pieces of legislation from Brussels will increase regulation on investing in commodities and securities, replicating the movement of commodity prices, the FCA has warned.
In an eight-page document, Regulating the Commodity Markets: a Guide to the Role of the FCA, the City watchdog claimed that the European Markets Infrastructure Regulation (EMIR), MiFID II, the Market Abuse Regulation (MAR) and new benchmarks from the European Commission could create a stricter environment for trading and investing in commodities………………………………………..Full Article: Source

CFTC nominee vows to press for curb in commodities speculation

Posted on 07 March 2014 by VRS  |  Email |Print

Timothy Massad, President Barack Obama’s nominee to head the Commodity Futures Trading Commission, told lawmakers he would “make it a priority” to finalize a rule aimed at curbing speculation by Wall Street traders in certain commodity contracts.
At his confirmation hearing before the Senate Agriculture Committee, Mr. Massad gave assurances the CFTC would pass a “position limits” rule, which was included in the 2010 Dodd-Frank law. He also deflected CFTC responsibility for overseeing investments by Wall Street banks in physical commodities such as oil and aluminum, saying the issue is “largely outside the jurisdiction of the CFTC.”……………………………………….Full Article: Source

UK commodity regulator embraces more openness: Kemp

Posted on 28 February 2014 by VRS  |  Email |Print

By publishing a new primer on the changing landscape for commodity markets and emerging issues for regulators, Britain’s Financial Conduct Authority (FCA) has taken a welcome first step towards greater transparency.
Despite its rather dull title, the FCA’s “Commodity Markets Update”, released on Thursday, is the best summary of how markets are changing in response to the fading super-cycle and tougher regulation in the wake of the financial crisis……………………………………….Full Article: Source

Fed extends comment period for new commodity rules

Posted on 28 February 2014 by VRS  |  Email |Print

The U.S. Federal Reserve gave market parties 30 more days to comment on its plan to submit Wall Street banks to greater restrictions in dealing physical commodities, the central bank said on Thursday.
The Fed last month took a first formal step to rein in banks’ ownership of oil tankers, metals warehouses and other such assets, worried that a major catastrophe could jeopardize one of the banks it oversees………………………………………..Full Article: Source

Report reveals benefit of lifting U.S. crude oil ban

Posted on 27 February 2014 by VRS  |  Email |Print

A Washington-based think-tank believes lifting a ban on U.S. crude oil exports will reduce gasoline prices. A team of economists and energy experts was assembled by Alan Krupnick, director for the Center for Energy Economics and Policy of the group Resources for the Future.
“Current U.S. policy to ban oil exports has taken on a lot of importance in U.S. energy policy circles in recent months,” said Stephen Brown, professor of economics at the University of Nevada Las Vegas. “We believed that we could contribute some valuable work to better understanding the issue.”……………………………………….Full Article: Source

Senator urges curbs on banks buying commodities

Posted on 26 February 2014 by VRS  |  Email |Print

Ohio Sen. Sherrod Brown on Tuesday said he pushed a pair of nominees for key regulatory posts to take steps to deter big banks from owning and storing oil, aluminum and other key commodities. Brown, chairman of a Senate panel that monitors financial institutions, has been urging regulators to crack down on behavior that could lead to higher prices for consumers.
Some large banks buy and hold commodities in a strategy that can lead to higher prices for things such as beer, canned food or fuel. Brown met with Chris Giancarlo and Sharon Bowen as they made the rounds among senators after their nomination to the Commodities Future Trading Commission. ……………………………………….Full Article: Source

FMC allows commodity bourses to impose differential transaction fees

Posted on 17 February 2014 by VRS  |  Email |Print

Commodity markets regulator FMC has allowed national level bourses to impose differential transaction fees for delivery and non-delivery based commodities contracts. Since 2009, the exchanges have been restrained from levying differential transaction charges based on commodities or timing.
“In suppression of the earlier directions, the Commission has now decided that the exchanges can levy differential transaction charges for different commodities,” Forward Markets Commission said in a directive issued to six national level commodity bourses………………………………………..Full Article: Source

India: Commodities, securities norms to converge

Posted on 14 February 2014 by VRS  |  Email |Print

With the commodities derivatives regulator, Forward Markets Commission (FMC), now under the finance ministry, rules governing the commodities markets are being converged with the securities derivatives’, wherever there are similarities.
One is to disallow commodity exchanges from having different transaction charges for different brokers. In securities, irrespective of volumes, the charges are similar for all brokers. However, the FMC has allowed exchanges to have different transaction charges for deliverable commodities………………………………………..Full Article: Source

Wall Street’s grandfathers of commodities to survive Fed revamp better than others

Posted on 13 February 2014 by VRS  |  Email |Print

As the U.S. Federal Reserve considers new ways of reining in banks’ trading in what it sees as risky physical commodity markets, Wall Street’s two oldest and biggest players may ultimately gain in stature.
Thanks to a longstanding legal exemption that Fed officials say limits their regulatory capacity, Morgan Stanley and Goldman Sachs may yet emerge from the regulatory upheaval that is upending banks’ commodities trading better-off than their peers, who face potentially tougher new rules………………………………………..Full Article: Source

Yellen promises new rules governing banks’ commodities activity

Posted on 12 February 2014 by VRS  |  Email |Print

Federal Reserve Chairman Janet Yellen pledged that the regulator will make changes in its oversight of banks’ role in the commodities business, which has attracted regulatory and lawmaker scrutiny.
“The Federal Reserve’s main focus in our supervision of these areas is to make sure that banks operate in the commodities activities in a safe and sound manner,” Yellen said at a House Financial Services hearing………………………………………..Full Article: Source

Commodity groups launch next attack on U.S. position limits rule

Posted on 12 February 2014 by VRS  |  Email |Print

A group of commodity firms came out against a new U.S. rule to curb market speculation in a letter on Monday, after banks successfully shot down an earlier version of the position limits rule in court.
The new rule by the Commodity Futures Trading Commission attracted well over 100 comment letters by industry participants after the agency - which regulates swaps and futures - launched it in November………………………………………..Full Article: Source

India: Commodity futures regulator to allow trading by bourse shareholders

Posted on 07 February 2014 by VRS  |  Email |Print

The commodity derivatives market regulator, Forward Markets Commission (FMC), is in the process of relaxing curbs to help brokers with a small shareholding in an exchange to start trading on it.
Chairman Ramesh Abhishek said at an Assocham conference here on Thursday that “the guidelines do not allow brokers with shareholdings in exchanges to trade even if these are in some other exchanges. We are in discussions with the government to change these. We feel brokers with up to two per cent or some such percentage can be allowed to trade as long, as they have no say in the management or on the board.”……………………………………….Full Article: Source

Global market overhaul floated by anti-rigging German regulator

Posted on 28 January 2014 by VRS  |  Email |Print

Germany’s top financial supervisor proposed moving currency and commodities trading to regulated exchanges as concern about the rigging of market benchmarks spurs a backlash by governments.
“It would make it far easier to detect trading patterns that manipulate prices,” Elke Koenig, head of the Bonn-based Bafin banking regulator, said in a phone interview on Jan. 23. The idea is to move such transactions “as much as possible to transparent trading centers under state supervision, as is the case with securities.”……………………………………….Full Article: Source

Gold-price banks meet amid regulatory pressure

Posted on 22 January 2014 by VRS  |  Email |Print

The five banks that set the benchmark price for gold are meeting Tuesday as they seek an external audit of the processes they use, according to a person with knowledge of the matter.
The five have formed a steering committee to review the so-called “London fixings” amid intense regulatory scrutiny over possible manipulation of precious-metals prices. As spot gold is traded over the counter 24 hours a day and there is no central source for data on prices, each morning and afternoon in London a group of five market participants meets to determine a snapshot of the price, commonly known as the London fix……………………………..Full Article: Source

India: FMC gives nod for continuous trading in commodity futures

Posted on 21 January 2014 by VRS  |  Email |Print

Commodity market regulator FMC has given permanent approval to four bourses — MCX, NCDEX, NMCE and ACE — for launching trade in particular set of futures contracts, instead of giving permission on an yearly-basis.
This relaxation has been given to four national bourses subject to certain conditions and also depending upon volume and level of traders’ participation in a particular contract………………………………………..Full Article: Source

Senate democrats push Fed on banks’ commodities trading

Posted on 16 January 2014 by VRS  |  Email |Print

Senate Democrats ratcheted up their criticism of big banks’ activities in the physical commodities markets Wednesday, pressuring the Federal Reserve to act quickly in an ongoing review of the banks’ ability to trade in materials such as oil and aluminum.
Several senators pressed a senior Fed official for more decisive action in the wake of the central bank’s decision Tuesday to seek input on—rather than impose—possible limitations for banks that trade, store, and sell commodities………………………………………..Full Article: Source

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Fed eyes fresh measures to restrict banks’ commodities trading

Posted on 15 January 2014 by VRS  |  Email |Print

The Federal Reserve is asking for public input on whether to put restrictions on banks’ trading and warehousing of physical commodities amid lawmaker scrutiny of potential conflicts of interest and market manipulation.
The Fed’s request released today seeks comment on 24 questions, including some on the risks posed by bank ownership and trading of commodities such as oil, gas and aluminum by deposit-taking banks and the possible benefits of imposing additional capital standards………………………………………..Full Article: Source

Commodity exchanges miffed by Mifid

Posted on 15 January 2014 by VRS  |  Email |Print

The name of the legislation is a mouthful and its acronym captures the feeling of many European commodity players towards it. The EU’s Markets in Financial Instruments Directive II, or Mifid (say it fast), could finally be agreed in Strasbourg today, after nearly four years of negotiations.
Among other things, the rules will impose fixed position limits in European commodity markets, from agriculture to metals and energy. The aim is to prevent uncontrolled speculation by traders and hedge funds who through outsized derivative transactions may seek to corner the market for their own gain………………………………………..Full Article: Source

Fed set to push ahead on new commodity trade rules

Posted on 14 January 2014 by VRS  |  Email |Print

The Federal Reserve is set to take its first formal step toward limiting major Wall Street banks’ role in physical commodities markets this week and issue a notice to seek public comment on the topic, sources familiar with the matter said on Monday.
The Fed will publish a so-called “advance notice of proposed rulemaking” on Tuesday, laying out the issues it is considering, one day before a second Senate banking committee hearing on the matter, the sources said………………………………………..Full Article: Source

Senate to quiz US regulators on Wall St. commodity bets

Posted on 10 January 2014 by VRS  |  Email |Print

A Senate panel will hold a hearing next week to question financial regulators over Wall Street’s role in physical commodity markets, drawing fresh attention to a controversy over the possible risks posed by the involvement of the largest U.S. investment banks.
The January 15 hearing by a subcommittee of the powerful Senate Banking Committee is to include testimony by top oversight officials with the Federal Energy Regulatory Commission and the Commodity Futures Trading Commission and an official from the Federal Reserve’s banking supervision arm……………………………..Full Article: Source

Commodities market regulation must evolve with time

Posted on 09 January 2014 by VRS  |  Email |Print

A Reserve Bank of India (RBI) working paper says regulation of commodity futures markets has to evolve concomitant to the changing dynamics of commodity markets. And, that only an emphasis on over-the-counter market reforms, mainly covering swap dealers, might be insufficient.
It says financialisation of commodity markets and some fundamental factors have driven commodity price inflation. Financialisation means a long-term shift in an economy from production to finance………………………………………..Full Article: Source

FMC plans boost for commodity markets

Posted on 02 January 2014 by VRS  |  Email |Print

The Forward Markets Commission (FMC) is planning several steps in the New Year to revive the commodity markets, which were hit badly by the National Spot Exchange Limited (NSEL) scandal in 2013. The regulator is planning to reduce the curbs on individual members and clients and encourage hedgers in the market.
Position limits of individual clients in the commodity exchanges are likely to be made dynamic soon. At present, these limits are fixed for each client irrespective of the overall open interest………………………………………..Full Article: Source

The U.S.’s crude oil policy

Posted on 19 December 2013 by VRS  |  Email |Print

The United States again is one of the world’s great energy powers. On Monday, the U.S. Energy Information Administration projected that American crude oil output will peak at nearly 10 million barrels per day by mid-decade, up from 6.5 million last year.
Last month, the International Energy Agency figured that the United States would overtake Saudi Arabia as the top oil producer, at least for a time. Yet some politicians remain unwilling to let the country reap the full benefits of this boon………………………………………..Full Article: Source

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