"You may be the most powerful guy in Washington right now."

Whoa. That's what one senator told hedge fund manager Michael Masters in June, regarding Masters' influence in convincing Congress that oil's run-up was due to nothing more than greedy speculators.

Masters -- along with a group of senators -- is releasing a report to Congress this week that outlines why speculators are to blame for the incredible surge in oil prices this year. Masters is essentially acting as the expert witness here, using his firsthand knowledge of financial markets to provide valuable testimony to a group of folks who, bless their hearts, watch over the soundness of our financial system.

That's all well and good. After all, we can't expect Washington's elite to be financial mavens, too. But if you think the story ends there, think again.

Who is this Masters guy?
Now, I have no problem with putting your money where your mouth is. In general, it's a good thing. But that may not be the case when a group of politicians who have the power to enact laws are relying on your opinion. I found it slightly worrisome that Masters' hedge fund's 13-F filing, which details his holdings, shows that he owns:

  • 3 million shares of American Airlines parent AMR (NYSE:AMR)
  • 2 million shares of Delta Airlines (NYSE:DAL)
  • 4 million shares of US Airways (NYSE:LCC)
  • 2.5 million shares of General Motors (NYSE:GM)
  • 1.2 million shares of United Airlines  (NASDAQ:UAUA)

I suppose it's possible that Masters truly likes the business prospects of this set of companies; money managers have done loonier things. But, come on -- it's nearly certain that these holdings are riding on the hope of a huge fall in oil prices.

Of course, I have no reason to believe that Masters is anything but an honest do-gooder with no intentions of swaying Congress' opinion. But I also have reason to believe that when you have tens of millions of dollars on the line, your tactical sales skills come out in full force. I also know that the government's interpretation of the word "free" in "free markets" is, shall we say, less than impressive.

In any case, I hope Congress takes Fortune's Jon Birger's advice. As he recommended, "The next time a Congressional committee wants to hold a hearing on how 'speculators' are driving up oil prices, each committee member should first be required to demonstrate … a basic understanding of the mechanics of futures trading."

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Fool contributor Morgan Housel doesn't own shares in any of the companies mentioned in this article. The Fool's disclosure policy is always up front.