The Oil Markets: Let the Data Speak for Itself

In summary, our position paper argues that with the fundamental supply-and-demand balance so tight and that with effective OPEC spare capacity so low it is logical to see very high prices to ration demand and/or encourage additional supply. That is the job and message of price, even if the message is unpopular.

Auteur(s) :

Hilary Till

Research Associate at the EDHEC Risk and Asset Management Research Centre,Co-Founder of Premia Capital Management, LLC

We discuss how many facets of the world oil market are too opaque, including future productive capacity estimates from important suppliers, inventory statistics from important non-OECD consumers, and summary position data from over-the-counter derivatives participants. For policymakers and their economists to make sound decisions, there must simply be more transparency in these markets. We take the position that the petroleum-complex futures markets contribute to the transparency of the oil markets. Even when fundamental data on the oil markets are sparse or opaque, large-scale supply-and-demand shifts leave footprints in futures-price relationships, from which one can potentially infer the market's fundamentals. Our paper provides several case-studies on this type of analysis. In the presence of active futures markets, an observer need not be a member of a cartel or a large corporation to gain insights into the oil market.

Type : Position paper
Date : le 06/10/2008
Pôle de recherche Finance

A voir également

Finance climatique, projets à impact positif, campus durables : l'EDHEC se mobilise pour les générations futures
- 30-06-2022
A l'heure où 77% des jeunes diplômés considèrent l'impact sociétal comme un critère...
Challenge néGO :  Apprendre à négocier comme des professionnels
- 29-06-2022
Les formations initiales de l’EDHEC intègrent des exercices construits avec des...
Focus sur le premier salon durable de l'EDHEC International BBA
- 23-06-2022
Le 7 avril a eu lieu le « premier salon durable » organisé sur nos campus de Lille et...
Pré-Master de l’EDHEC : bilan et nouveautés
- 23-06-2022
En 2021, l’année de Pré-Master avait été marquée par de nouvelles évolutions. Hager...