And money continues to move into the energy futures markets.

I'm not in the 'speculation is a major component of the price rise' camp, but a little here and a little there and pretty soon the billions are noticable.

Granted, this is a number for all commodities, but I can't find the breakout for oil alone.

In the last five years, investments in index funds tied to commodities grew to US$260 billion from US$13 billion.
Pension funds deny speculation on oil

This one is more to the point - that there is serious money taking a bit of profit here and there, as contracts open and close, money that wasn't in the market several years ago, money that is influencing the game through loopholes similar to those that sucked billions from the pockets of California electricity rate payers. The pension companies, in other documents (in the same article above) say that they only have 2-4 % of their assets in this kind of speculation and that the return goes to the little guy's retirement funds. [Tobacco, Blood Diamonds, War Toys profits - where was it that I heard these arguments before?]

Energy Speculation Causes Fuel Price Inflation
June 22, 2008 | Progressive Democrats of America [does this include North and South, one wonders?-ed]

Commodity Index Investment vs. Spot Prices

In the popular press the explanation given most often for rising oil prices is the increased demand for oil from China. According to the DOE, annual Chinese demand for petroleum has increased over the last five years from 1.88 billion barrels to 2.8 billion barrels, an increase of 920 million barrels. Over the same five-year period, Index Speculators demand for petroleum futures has increased by 848 million barrels. The increase in demand from Index Speculators is almost equal to the increase in demand from China!

Commodity Index Purchases Last 5 Years

Index Speculators have now stockpiled, via the futures market, the equivalent of 1.1 billion barrels of petroleum, effectively adding eight times as much oil to their own stockpile as the United States has added to the Strategic Petroleum Reserve over the last five years.

Index Speculator Demand Characteristics

Demand for futures contracts can only come from two sources: Physical Commodity Consumers and Speculators. Speculators include the Traditional Speculators who have always existed in the market, as well as Index Speculators. Five years ago, Index Speculators were a tiny fraction of the commodities futures markets. Today, in many commodities futures markets, they are the single largest force. The huge growth in their demand has gone virtually undetected by classically-trained economists who almost never analyze demand in futures markets.

Index Speculator demand is distinctly different from Traditional Speculator demand; it arises purely from portfolio allocation decisions. When an Institutional Investor decides to allocate 2% to commodities futures, for example, they come to the market with a set amount of money. They are not concerned with the price per unit; they will buy as many futures contracts as they need, at whatever price is necessary, until all of their money has been "put to work." Their insensitivity to price multiplies their impact on commodity markets.

Never underestimate their intelligence, always underestimate their knowledge.

Frank Delaney ~ Ireland