THE BURNED OVER DISTRICT

It looks like the agency that opened the door to unregulated speculation by hedge funds in the oil futures market is going to examine the situation.

The nation's top regulator of oil trading announced on Tuesday the creation of a special federal task force to study the role of speculators and the investment practices of large institutions that critics believe are running up oil prices.

The announcement came as a special advisory committee went before the Commodity Futures Trading Commission to discuss ways to make the oil markets more transparent. Increasing reporting requirements and other transparency measures would reduce concerns that oil traders are manipulating the trading of contracts for future delivery of oil, called futures, in ways that drive up oil prices. The CFTC announced in late May that it was investigating whether there has been price manipulation during this year's steep run-up in global oil prices.

Like others, I don't see much coming from this as the CFTC was the source of the problem and the task force would be guided by those who have done their fair share to aggravate the problem.

Treasury Secretary Henry Paulson, who led investment bank Goldman Sachs & Co. before joining the Bush administration, suggested Tuesday that supply and demand forces alone are to blame for today's record prices, sparking debate.

Bart Chilton, a CFTC commissioner, said that Paulson spoke too soon.

"Perhaps the secretary has a crystal ball, but I don't, and given what I'm seeing and hearing in the markets and from market users, that seems to be a premature determination, at best," Chilton, a former vice president of the National Farm Union, said in prepared remarks. "At worst, I think it would be a dereliction of our duties for us, the overseers of these markets, to ignore other possible reasons for price run-ups, and continue to fall back on reliance on 'fundamentals.'"

Poor old Bart doesn't realize that dereliction of duty will gain you much praise and promotion in this White House.