MPs are to examine the role of speculators in driving oil prices to their current high levels.

The House of Commons’ powerful Treasury Select Committee is to examine the issue at a meeting later this month, according to John McFall MP, the committee’s chairman.

News of the meeting emerged as the price of a barrel of crude touched a fresh record high of $146.69 today and Prime Minister Gordon Brown warned of further increases on the way, driven by soaring demand from China and other developing Asian countries.

“If demand succeeds supply and is likely to exceed supply for years to come, people will expect the price to rise,” Mr Brown told MPs on the Commons Liaison Committee.

Addressing the issue of speculation at the same meeting, Mr McFall, Labour MP for West Dunbartonshire, said: “There is a real problem here. We really need to take some action because it’s reported there is $260 billion of speculative money in the oil futures market.”

It is not yet clear who will be asked to give oral evidence at the meeting but senior figures from ICE Europe and some of the world’s top investment banks are expected to attend.

The meeting of the Treasury Select Committee, which is scheduled for July 15, follows mounting calls in the US Congress for action by UK authorities to stamp out alleged excessive speculation in the London oil market.

A powerful clique of Democratic senators with close links to Barack Obama have blamed high crude prices on traders using City-based oil futures exchanges, in particular ICE Europe - the former International Petroleum Exchange.

They have dubbed the FSA’s relatively light-touch regulatory approach the “London Loophole” and have called for US-style regulation to be applied in the UK.

Mr McFall pointed out that both US presidential candidates, Republican John McCain and Democrat Barack Obama, had expressed concern about the role of speculation in oil markets.

The biggest oil producing countries, including Saudi Arabia, have also blamed speculation for a rally that has seen oil prices double over the past year.

The US House of Representatives is considering a range of bills aimed at limiting speculative activity, including the End Oil Speculation Act of 2008 and the Federal Price Gouging Prevention Act.

However, US Treasury Secretary Hank Paulson and senior figures in the UK government have stated they do not believe speculation to be a major factor driving prices to their current levels.

They blame a fundamental imbalance between oil supply and demand.

Times Recommends

• Minister in talks with Saudis to protect creditors
• Premier Inn hits back in £29-a-room row
• Bankers hit back at 'populist' bonus supertax