Verleger added that banks like JP Morgan Chase have jumped into the oil business thanks to the Federal Reserve, which has made money available to them at low costs.
Bloomberg reported in June that JP Morgan Chase hired an oil tanker to store heating oil off the cost of Malta. According to Bloomberg, the bank's actions are similar to those of Citigroup, which took similar steps, hiring a ship to store crude oil at sea.
The banks buy the oil at lower prices today and sell it in prearranged futures contracts at a higher price at a later date.
Purchasing oil and then reselling it immediately and profiting from the difference in price is more likely to be referred to as arbitrage. Speculation would entail less certainty about future prices and with that risk, the possibility of greater profits, or possibly even losses.
The lawmakers said they firmly believe that speculation accounts for the rise in oil prices and want the CFTC to do something about it.
"The long-term goal has got to be to get excessive oil speculation out of that area," Sanders said. "If we can do that and allow supply and demand to do what it does, I suspect that oil prices will drop fairly significantly."
Asked if this issue could be the next source of serious public outrage after the Wall Street bailout backlash, Sanders replied: "I think it should be. And I think it will be."