Sept. 11 (Bloomberg) -- Commodity index traders accounted for 13 percent of Nymex oil trading, with their positions declining by 45,000 contracts in the first six months of the year, U.S. regulators said.

The data, the first on swap dealers published by the Commodity Futures Trading Commission, may call into question claims that index investors have pushed prices to records this summer. In response to the report, the agency is calling for new classification of certain speculators, new reporting from over- the-counter markets and greater transparency in the markets.

The commission, which oversees $5 trillion of futures trading, has been under pressure from Congress to crack down on speculators, including large banks and institutional investors, who some have blamed for driving up commodity prices. It used a special authority to get the data from swaps dealers, who broker trades with private clients who want exposure to raw materials.

``At first glance the numbers seem inconsistent with the allegations that swaps traders and index traders are driving up the price of oil,'' said Robert Webb, a finance professor at the University of Virginia.

Michael Masters, president of the Masters Capital Management hedge fund, released a report yesterday blaming index investors for pushing crude to records. He testified three times before Congress this year, arguing that limits on traders would cut oil prices to $65 to $70 a barrel.

Speculators' Role

``The CFTC's findings are too little, too late,'' Representative Bart Stupak, a Michigan Democrat, said in a statement. The report ``makes it clear congressional action will be necessary to enact the reforms the CFTC is reluctant to implement on its own.''

Index traders cut their positions betting that prices would rise to 363,000 contracts from 408,000 contracts in the first six months of the year, the CFTC said. In that same time, crude prices rose 46 percent, the agency said.

``It doesn't seem there's a correlation between price and investment'' by index funds, Walter Lukken, the CFTC's acting chairman, told the House Agriculture Committee today. The committee has oversight authority over the agency.

Even with the new data on swaps dealers, the CFTC is pushing for more transparency in the unregulated market. The agency is proposing to publish a periodic analysis of swap dealers trading. Index traders and swap dealers held about $200 billion in commodity markets at the middle of this year, the CFTC report said. About $161 billion of that amount was tied to commodities trading on U.S. markets it regulates, the CFTC said.

Masters had told Congress that index investors amounted to $260 billion. Masters couldn't be reached for comment.

Oil Record

Crude oil futures contracts reached a record $147.27 a barrel on July 11 in trading on the New York Mercantile Exchange. Oil fell $1.71 to $100.87 on the Nymex today.

``When the statistics included in the report do not include the month the price spike hit, they deserve some criticism,'' Robert McCullough, managing partner of energy consulting firm McCullough Research, said in a telephone interview.

``This is the case where when the bank robber leaves the bank, he takes the money with him,'' said McCullough, an economist who helped trace Enron Corp.'s power market manipulations. ``You'd expect to see the firms liquidate before the price maxes out.''

Fund Betting

Members of Congress have proposed more than a dozen pieces of legislation in a bid to curtail speculation in the markets.

``The CFTC report refutes the notion that investor participation in the commodity markets has caused the rise in oil prices,'' Richard Baker, president of the Managed Funds Association and spokesman for a coalition of exchanges and traders, said in a statement. It ``undermines the political rhetoric about investors and their impact on energy prices.''

Most of the index investing was done by pension funds and endowments, Lukken said at the hearing. About 24 percent of the value of investments was held by index funds, 9 percent by sovereign wealth funds and 25 percent were classified as ``other,'' mostly exchange traded funds, Lukken said.

The report includes recommendations that call for removing swap dealers from the category of commercial traders and giving them their own classification. Right now, the commission's reports separate out only commercial and non-commercial, a delineation based on whether the trade is meant to hedge a position or not.

The agency also proposes to publish new reports on over- the-counter swap dealer activity, create a new office of data collection and require certain large traders to provide additional data on their activities.

Swap Exemptions

The commission said it will review whether to continue offering exemptions for swap dealers and will look at whether swap dealers, including banks like Goldman Sachs Group Inc., are sufficiently independent of market research that they publish.

The agency says it will need an additional 30 employees to carry out its recommendations.

Commissioner Bart Chilton, a Democrat, issued a dissent from the recommendations, saying they don't ``go far enough, and I have significant concerns relating to the underlying analysis on which the recommendations are based.''

The changes mean the agency ``will be looking at things in a different way, in a more detailed way,'' Chilton said in an interview on Bloomberg Television.

``Hopefully we're getting a better handle on what's going on in these markets to make sure we're keeping them honest,'' he said.

Congress is unlikely to act on speculation legislation without proof of wrongdoing in the markets, Kevin Book, senior energy analyst for Friedman, Billings, Ramsey & Co. Inc., said in a note yesterday.

``Without a smoking gun, we do not expect a bill to pass,'' he wrote.

To contact the reporters on this story: Matthew Leising in New York at mleising@bloomberg.net; Tina Seeley in Washington at tseeley@bloomberg.net.

Last Updated: September 11, 2008 17:49 EDT