US commodities regulator the Commodities Future Trading Commission  (CFTC) has launched begun to investigate possible market manipulation in the US crude oil market amid record oil prices and oil company profits. This from The Daily Telegraph:

The Commodities Future Trading Commission (CFTC), working closely with other international regulators including the Financial Services Authority in the UK, has begun a series of detailed inquiries over concerns that energy speculators are behind the rising oil price.
In a detailed statement, the CFTC admitted for the first time that it began its investigation in December, taking what it called the “extraordinary step” of disclosing the probe “because of today’s unprecedented market conditions”.

The CFTC declined to discuss the specifics of the investigation, but stressed that all of its enforcement inquiries were focused on “ensuring that the markets are properly policed for manipulation and abusive practices”.

“It doesn’t look like the party is over just yet for oil,” says Chris Mayer in The Daily Reckoning. “But even if it is, past peaks in oil give us clues. When you dig a little deeper into those relationships, you find a great road map for making money.

“If you look at the price of oil, you find something interesting. Since January 2001, you can explain the move in the price of oil largely as a function of increasing money supply. As the amount of money grows, the price of oil rises. In fact, almost 87% of the move in the price of oil can be explained by the increase in money supply.”

Meanwhile, legendary oil investor T. Boone Pickens is forecasting higher and higher prices for black gold.  He’s also putting money into new oil companies.

Pickens just bought this new oil company. According to Ann Sosnowski in Taipan Daily, it’s been on a solid run, returning an 83% gain in only four months. But it’s still cheaper than the major oil companies like BP and Exxon Mobil.