Goldman Sachs Group Inc on Tuesday portrayed its energy trading as hedging that should be exempt from proposed U.S. government limits on the volume of contracts that speculators can trade.

Goldman's Chief Financial Officer David Viniar said the bank's trades are vital to enable hedging. He said during a conference call that proposed regulations may have little impact on Goldman's commodities results if the U.S. Commodity Futures Trading Commission retains hedging exemptions currently granted to banks doing energy trading.

Consumers need hedging. Producers need hedging. And you need financial intermediaries to help do that, Goldman's Chief Financial Official David Viniar told a conference call with analysts after unveiling the company's second quarter results.

Goldman, which declared record revenues in the second quarter from combined fixed income, currencies and commodities trading, is the first major Wall Street bank to respond to regulations proposed by the CFTC.

The CFTC said last week it plans to seek federal limits on the amount of oil and gas contracts that traders, including financial speculators, are allowed to hold.

Big Wall Street banks such as Goldman hold huge positions in trading of energy derivatives, created to allow commercial players to hedge risk. The CFTC is considering outright positions limits, as well reviewing whether it should continue to grant exemptions to financial players allowed to buy as many energy contracts as they need for hedging.

CFTC officials have said the goal is to rein in excessive speculation blamed for driving oil and commodity prices to record levels last year before markets crashed in the fall.

The agency said it would seek the views of market participants for the regulations, which may be enforced as early as October. 

Goldman, which is also involved in physical trading of crude oil, will wait to see how the new regulations pan out, Viniar said. The devil is in the details...so it's hard to say.

Even before the CFTC initiatives rolled out last week, the Obama administration had proposed bringing unregulated over-the-counter trades in commodities to exchanges that clear them centrally and transparently.

Viniar said Goldman supports that move because it was a believer in central clearing.

We think that is good...for the market, and actually it's good for us because it levels the playing field in some ways.

(Editing by David Gregorio)