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The two-year, $5.3 million investigation by Interior's inspector general found workers at the Minerals Management Service's royalty collection office in Denver partying, having sex, using drugs and accepting gifts and ski trips and golf outings from energy company representatives with whom they did government business.

The investigations exposed "a culture of ethical failure" and an agency rife with conflicts of interest, Inspector General Earl E. Devaney said.

Between 2002 and 2006, 19 oil marketers — nearly a third of the Denver office staff — received gifts and gratuities from oil and gas companies, including Chevron Corp., Shell, Hess Corp. and Denver-based Gary-Williams Energy Corp., the investigators found.

"Employees frequently consumed alcohol at industry functions, had used cocaine and marijuana, and had sexual relationships with oil and natural gas company representatives" who referred to some of the government workers as the "MMS Chicks."

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"Employees frequently consumed alcohol at industry functions, had used cocaine and marijuana, and had sexual relationships with oil and natural gas company representatives" who referred to some of the government workers as the "MMS Chicks."

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Oil Posts Biggest Gain as Traders Caught in End-Month Squeeze

By Mark Shenk

Sept. 22 (Bloomberg) -- Crude oil climbed more than $25 a barrel, the biggest gain ever, as traders scrambled to unwind positions on the October contract's last day of trading. The more-active November contract rose $6.62.

``This looks like a squeeze play,'' said Phil Flynn, senior trader at Alaron Trading Corp. in Chicago. ``All of the contracts are up, but nothing like October. This is the last day of trading and someone is scrambling to guarantee supply.''

Crude oil for October delivery rose $16.37, or 17 percent, to settle at $120.92 a barrel at 2:46 p.m. on the New York Mercantile Exchange. It was the highest settlement price since Aug. 21. Futures for November delivery rose 6.4 percent to settle at $109.37 a barrel.

Prices climbed today as traders who sold the October contract last week, when oil dipped close to $90, had to buy the futures back. In a squeeze a trader has gone short by selling contracts hoping the price will decline. In the last days before the contract expires the trader must buy back the same number of futures or be forced to deliver the underlying oil.

``I don't think there's any doubt that's the indication of a huge squeeze,'' said Craig Pirrong, director of energy markets for the University of Houston's Global Energy Management Institute. ``It's just stunning this could happen'' given the recent scrutiny in Congress and among U.S. regulators concerning the crude oil markets, he said.

`Yawning Gap'

``It's a very small pool playing in this market right now, and that's why you're seeing those massive differentials'' between the October and November contracts, said David Kirsch, an energy markets analyst at PFC Energy in Washington. ``Somebody did place a wrong bet and is trying to cover that position.''

``The overarching factor is that the October futures contract expires today,'' said Ryan Oatman, an analyst at SunTrust Robinson Humphrey in Houston. ``This is a classic short squeeze. What lead up to it was a strong euro, up on concerns U.S. government actions will ultimately result in a greater budget deficit, higher inflation and a weaker dollar.''

Investors looking to hedge against the dollar's decline earlier this year have helped lead oil, gold, corn and gasoline to records. Oil rose as high as $130 a barrel, up from $104.55 on Sept. 19, as the dollar dropped on concern that a U.S. proposal to buy $700 billion of troubled assets from financial firms will deepen the budget deficit.

The dollar declined 2.4 percent to $1.4817 per euro, from $1.4466 on Sept. 19. It touched $1.4818, the weakest level since Aug. 22.

Hard Assets

``Gold, silver, oil, copper, just about any hard asset, is looking good at this point,'' said Michael Fitzpatrick, vice president for energy risk management at MF Global Ltd. in New York. ``With the dollar down and stocks getting hit, commodities look like a safe play.''

Oil has risen 33 percent since Sept. 16 as lawmakers pledged fast consideration of the Treasury's plan to buy devalued mortgage-related securities.

``There's a flight to quality and the energy markets are benefiting,'' said Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts. ``The dollar is down again and investors are fleeing to commodities. We are back to the cycle that pushed prices to records earlier this year.''

Hedge-fund managers and other large speculators increased their net-long position in New York crude-oil futures in the week ended Sept. 16, according to U.S. Commodity Futures Trading Commission data.

Speculative long positions, or bets prices will rise, outnumbered short positions by 19,379 contracts on the New York Mercantile Exchange, the Washington-based commission said in its Commitments of Traders report.

Gasoline

Gasoline for October delivery increased 10.41 cents, or 4 percent, to settle at $2.7038 a gallon in New York. Heating oil rose 14.52 cents, or 5 percent, to settle at $3.043, the biggest single-session gain since June 6.

Regular gasoline, averaged nationwide, declined 1.8 cents to $3.739 a gallon, AAA, the nation's largest motorist organization, said today on its Web site. Pump prices reached a record $4.114 a gallon on July 17.

Crude oil prices are ``too high'' because the global economic slowdown may spread and cut consumption, the International Energy Agency's deputy executive director said.

``The economic slowdown in the U.S., Europe hasn't gotten into China, India much, but at some point you have to presume it will,'' William Ramsay said in an interview in Bangkok today.

The Paris-based IEA, which advises 27 developed nations on energy policy, was set up in 1974 in response to the Arab oil embargo.

Brent crude oil for November settlement rose $6.43, or 6.5 percent, to settle at $106.04 a barrel on London's ICE Futures Europe exchange.

To contact the reporter on this story: Mark Shenk in New York at mshenk1@bloomberg.net.

Last Updated: September 22, 2008 15:53 EDT

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Oil prices make biggest single-day jump ever, settle at $120 per barrel
BY STEVENSON JACOBS The Associated Press

    NEW YORK — Oil prices briefly spiked more than $25 a barrel Monday, shattering the record for the biggest one-day gain as unease about the government’s $700 billion bailout plan pummeled the dollar and spurred investors to buy safe-haven assets. An expiring crude contract added fuel to the frenzied rally.
    Light, sweet crude for October delivery jumped as much as $25.45 to $130 a barrel on the New York Mercantile Exchange before falling back to settle at $120.92, up $16.37. The contract expired at the end of the day, adding to the volatility as traders rushed to cover positions; the October price began accelerating sharply in the last hour of regular trading, a common occurrence when a contract is about to go off the board.
    Still, the rally, which shattered crude’s previous one-day price jump of $10.75, set June 6, showed the intensity of emotion in the market. The Nymex temporarily halted electronic crude oil trading after prices breached the $10 daily trading limit. Trading resumed seconds later after the daily limit was increased.
    The November crude contract, which became the front-month contract at the end of Monday’s session, settled at $109.37, up $6.62, still a very sharp gain.
    The severity of the price move shocked veteran market participants and prompted the U.S. Commodity Futures Trading Commission to launch an investigation into whether illegal manipulation was to blame.
    Acting CFTC Chairman Walter Lukken said the agency’s surveillance and enforcement staff was analyzing the price spike “to ensure that no one is taking advantage of the current stresses facing our financial marketplace for their own manipulative gain.”
    Phil Flynn, analyst and oil trader with Alaron Trading Corp. in Chicago, said the late-session surge in oil appeared to be the result of a large investment fund scrambling to cover their short positions, or bets that prices would fall.
    “When people sense that someone is short, it’s like blood on the streets. It just accelerates the rally,” Flynn said.
    In other trading, gold prices shot up more than $44.30 to settle at $909 an ounce, and other safehaven commodities also rallied, underscoring investors’ uncertainly about the direction of the economy and their fear of more turmoil ahead.
    “We’re off to the races again,” said Jim Ritterbusch, president of energy consultancy Ritterbusch and Associates in Galena, Ill. “There’s a renewed scramble for commodities because of a general weakness in the dollar.”
    Crude has gained about $30 in a dramatic four-day rally that has at least temporarily halted oil’s steep two-month slide below $100. At this rate, crude is within striking distance of its all-time record of $147.27, reached in July.
    The rally came as energy traders grappled with the implications of the government’s proposed initiative to stem the U.S. financial crisis by absorbing billions of dollars of banks’ bad mortgagerelated securities. Anxiety over the plan also sent stocks sharply lower Monday; the credit markets were calmer than they were last week, but still showing the effects of investors’ nervousness.
    Investors fear that the government will have to dramatically ramp up borrowing to pay for the mammoth rescue effort, an inflationary move that could further devalue the dollar and trigger another wave of safe-haven buying in investments such as commodities.
    “They’re going to have to continue auctioning off a whole lot of Treasurys to finance these projects, so the dollar is going to suffer,” said Matt Zeman, head trader at LaSalle Futures in Chicago. “Right now it’s fear and anxiety driving people who want tangible assets.”
    The 15-nation euro rose to $1.4796 in afternoon trading, up from the $1.4470 on Friday. A weak greenback was a catalyst for the commodities boom of the past year, and analysts said large investment funds were expected to pour money back into the sector.
    “That trade was very successful in the past, so if the dollar keeps weakening, a lot people are going to want to own hard assets like crude,” said Andrew Lebow, senior vice president and broker at MF Global in New York.
    Crude’s resurgence could halt steadily sliding pump prices. A gallon of regular gasoline shed 1.8 cents overnight to a new national average of $3.739, according to auto club AAA, the Oil Price Information Service and Wright Express.
    But there is still much uncertainty about what impact the U.S. rescue plan will have on energy demand. Oil’s run-up near $150 a barrel in July and a weak U.S. economy has forced Americans to cut back on their driving and led businesses to scale down operations. Though pump prices have eased from record levels above $4 a gallon, they remain expensive, and more softening in the economy would likely further curtail energy use in the world’s thirstiest consumer.
    Given the dire economic outlook, some analysts questioned whether oil prices would keep rising.
    “We’ve already seen that the world can’t afford oil at these prices. If it keeps going up, demand will drop off again,” Flynn said.
    However, he cautioned that oil’s future direction hinged on the outcome of the government bailout plan and its effect on the U.S. economy.
    “If the dollar keeps getting whacked and everybody panics, then we are going up again,” he said.
    In other Nymex trading, heating oil futures rose 14.52 cents to settle at $3.043 a gallon, while gasoline futures rose 10.41 cents to settle at $2.7038 a gallon. Natural gas futures rose 9.5 cents to settle at $7.943 per 1,000 cubic feet.


SETH PERLMAN/THE ASSOCIATED PRESS In this April 2008 file photo, oil pump jacks are seen at sunset in a cornfield near Divernon, Ill. Oil prices briefly spiked more than $25 a barrel Monday.

Quoted from mikechristine1

I’m sure info is somewhere, just where is what I’d like to know.  

They said on the news oil went down below $100 per barrel.  

When oil first hit that magic $100 per barrel, what did the gas prices go to?  Were they less than they are now?