Sep. 16--When oil topped $140 a barrel and gasoline went for $4 or more last summer, a lot of fingers pointed at speculators.

Such investors pour billions of dollars into the oil futures market, buying "paper oil." In essence, they place big and volatile bets on what the price of oil will be in the coming months, and they don't actually take delivery of any oil.

Although often not directly linked to supply and demand market forces, the contracts drive the actual cost of oil and other commodities.

Federal regulators are now considering a crackdown on speculators.

And you might be surprised to learn where some of that big money is coming from: the $6.2 billion Missouri State Employees' Retirement System.

The fund is considered the first public pension fund in the U.S. to invest heavily in so-called commodity indexes -- which hold vast amounts of futures contracts for crude oil, wheat and other commodities. The amount of cash that index trading has injected into the market has ballooned from $13 billion in 2003 to $260 billion in 2008.

But should public pension money -- which comes from Missouri taxpayers -- be invested in such a way that can, for instance, pump up the price of gasoline for everyone?

Mark Cooper, research director for the Consumer Federation of America, said in an interview that federal limits were needed if the Missouri fund and other investors in the indexes didn't curb themselves.

"The debate is over about excessive speculation," he said. "Now the question is what we are going to do about it."

A survey by The Kansas City Star found that eight state-employee pension plans in the U.S. now invest in commodity indexes. A separate Missouri pension plan for retired schoolteachers does not invest in the indexes and neither does the Kansas Public Employees Retirement System, although it is considering doing so.

Officials of the Missouri fund, which has 100,000 active and retired members including elected officials and judges, say they are just trying to get the best returns they can for their pensioners.

The fund's investment in commodity indexes has at times approached half a billion dollars, and the fund earned a 74 percent profit in the budget year that ended in June 2008, when crude oil and gasoline prices were approaching record highs. Showing commodities' volatility, the fund's commodity index investments then lost 54 percent in the latest fiscal year, as fuel and grain prices came down.

Rick Dahl, the Missouri pension fund's chief investment officer, said it made sense to diversify beyond stocks and bonds.