Senate Democrats push oil speculation bill

By Tom Doggett and Tom Ferraro

WASHINGTON (Reuters) - Senate Democratic leaders will try on Tuesday to move forward legislation to crack down on excessive oil speculation, which many blame for inflating prices of crude oil and gasoline.

Sen. Byron Dorgan, of North Dakota, a member of the Democratic leadership, said he hopes to get enough votes this week to allow consideration of the bill and pass the measure.

Soaring energy prices have become a top concern this election year, with Democrats and Republicans in Congress offering often competing solutions.

Passage of any reform will be difficult in the Senate, where Democrats have a slim 51 to 49 majority. Republicans, who want to increase U.S. oil drilling, have enough votes to raise procedural hurdles and possibly block passage of any plan.

The Senate legislation would require institutional traders to give the Commodity Futures Trading Commission more details on unregulated over-the-counter transactions to determine if price manipulation or excessive speculation is occurring.

The CFTC also would review trading practices of swaps dealers and commodity index funds.

The legislation would not require the higher margins to buy and sell oil that the futures industry had feared. But the bill requires tough position limits on speculators to restrict the number of oil contracts they could control.

Sixty "yes" votes will be needed on Tuesday's motion merely to open the door to proceed on the bill. Dorgan also hopes to gain Senate passage this week, and backers believe they will get sufficient support.