U.S. energy markets face a new regulatory framework arising from the failings of the financial sector. Trading costs will rise, threatening liquidity. However, many key elements of the Wall Street Transparency and Accountability Act of 2010 (Dodd-Frank Act) have been passed on to regulators. Their true nature will emerge only with time. The Act does little to streamline oversight activities, while the biggest problem may prove to be ‘regulatory creep’.
Background
The Dodd-Frank bill cleared the U.S. House-Senate Conference Committee back on April 25 following intensive days of negotiation, lobbying, and a final all-night drafting session. The House of Representatives quickly approved the legislation, but it stalled in the Senate where a super-majority is required to avoid filibuster. After considerable maneuvering, the bill passed on July 15 and was signed into law by President Barack Obama the next week.…