Do the fluctuations last long enough to do serious harm? If these movements are predominantly fundamental in nature, attempts to resist them would be largely futile and counterproductive. Efforts to dampen speculation through limits on the number of allowable contracts or tighter margin requirements would penalize both good and bad speculation, and potentially handicap the operation of markets.
Efforts to put ceilings on commodity prices would prevent market clearing and reduce supply. Clearly, if anything of this sort is contemplated, it should be done cautiously. President Sarkozy, who will chair the G20 leaders’ summits for the coming year, has put reform of the commodity derivative market near the top of his agenda.