Oil Market Volatility: OPEC Wants Higher Oil Prices, Considers Output Cuts - Bloomberg
Saudi Arabia’s Energy Minister Prince Abdulaziz Bin Salman Al Saud is no slouch when it comes to moving the oil market. A few well-chosen words and a hint of output cuts to come — and Brent is back above $100 a barrel within little more than 24 hours. But I’m puzzled by his most recent logic.
The minister appears to be laying the blame for oil’s retreat from its recent highs on the very same people his predecessors blamed for past moves in the opposite direction. The most likely truth is that the kingdom just wants higher oil prices.
This is what he said: “The paper oil market has fallen into a self-perpetuating vicious circle of very thin liquidity and extreme volatility.”
What he means is that there aren’t enough people trading in the futures markets for oil. That’s an odd thing for a Saudi oil minister to suggest. Who does he want to be more active in trading oil futures?
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