By Tom Doggett

WASHINGTON, July 2 (Reuters) - U.S. Democratic lawmakers want President George W. Bush to raise the problem of soaring oil prices and excessive speculation in energy markets with other world leaders at the G8 summit in Japan next week.

Hedge funds and other speculators have been blamed for doubling the price of crude oil in the past year to a record of nearly $144 a barrel, resulting in record gasoline costs that top $4 a gallon for American consumers.

"The upcoming July 2008 G8 summit is an important opportunity to tackle the problem of rising oil prices on a global scale," the lawmakers said this week in a letter to Bush.

"We urge you to engage your counterparts in efforts to reduce global oil speculation and other questionable market activities that distort the supply and demand market equation and artificially distort the price of these commodities," they said.

Speaking to reporters on Wednesday, Bush said, "We'll be talking about energy" at the G8 meeting.

However, he repeated that: "It took us a while to get into the energy situation we're in. It's going to take us a while to get out of it."

Bush again called on Congress to allow drilling in more U.S. waters and Alaska's Arctic National Wildlife Refuge, which would put additional supplies on the market in the long term, and he believes lower prices.

He said it made no sense "to watch these gasoline prices rise when we know we can help affect the supply of crude oil, which should affect" pump costs.

The lawmakers acknowledged that global supply and demand for oil and the weak U.S. dollar, in which most crude is priced, has played a major role in determining the value of petroleum.

Nonetheless, they said, speculators are "placing a distorted premium" on oil prices. As evidence, the lawmakers pointed out the nearly $240 billion increase in investments in oil futures since 2000.

"While U.S. regulators must do their part to investigate and address the excessive speculation artificially inflating energy prices, this truly is a global problem that requires action from all of the key players in the global economy," said Rep. Bart Stupak, chairman of the House Oversight and Investigations subcommittee and one of the lawmakers who signed the letter. (Reporting by Tom Doggett)

AlertNet news is provided by