STREATOR, Ill. (DTN) -- Sen. Debbie Stabenow, chairwoman of the Senate Committee on Agriculture, Nutrition and Forestry, sent a letter to the Commodity Futures Trading Commission on Tuesday seeking a review of recent allegations about possible manipulation of Renewable Identification Number markets.
RINs are the credits used by obligated parties -- refiners, blenders and importers -- to comply with annual renewable fuel blending mandates spelled out in the Renewable Fuel Standard.
Stabenow, D-Mich., called on the CFTC, which oversees markets for commodity futures, options and swaps, to use its expertise and authority to help preserve the integrity of the RINs market.
In a news release issued by Stabenow Tuesday, she said, "Press reports have highlighted potential speculation and manipulation of the unregulated markets, possibly contributing to recent market volatility and spikes in price."
Stabenow wrote to CFTC Chairman Gary Gensler saying she wants the CFTC to help determine whether factors other than supply and demand "have been causing extraordinary volatility in the price of RINs and to what extent fraud and manipulation have been affecting the price of RINs."
The senator said, "I am concerned that a lack of transparency in these markets has made them more susceptible to manipulation. If this is the case, it is a problem that must be identified and fixed."
She also asked that if there are limits to the CFTC's authority, expertise, or resources that could inhibit it from monitoring these markets, the CFTC inform her committee of those as soon as possible.
"While I support an actively traded market with a diverse array of market participants, the market must function and allow entities to manage their risk and comply with the law," she wrote.
She requested that the CFTC coordinate with the Environmental Protection Agency, the agency that administers the RFS, "to achieve these important objectives."
Myke Feinman can be reached at email@example.com
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