The financial sector needs far better regulation to counter the “disturbing” volatility of oil prices, according to the Organisation of Petroleum Exporting Countries (OPEC).
The call comes as the Middle Eastern oil group noted yesterday how Eurozone sovereign debt fears have led to a “marked and steady fall” in oil prices in the past two months.
At the group’s bi-annual meeting in Vienna, Austria, OPEC countries decided to keep a ceiling for oil production at 30million barrels per day – a level which was originally set in December 2011, although analysis suggests it was overshooting this amount earlier this year.
Despite OPEC members agreeing there was plenty of oil on the market to cope with the growing world oil demand predicted this year, the President of the conference warned prices are still “disturbingly” volatile.
HE Abdul-Kareem Luaibi Bahedh, Minister of Oil of Iraq told the conference: “There is a still a disturbing level of price volatility. When we last met, the average weekly price of OPEC’s Reference Basket was around US $109 a barrel. It then rose to almost $124/b half-way through this six-month period, before falling again. Most recently, however, the price has become extremely volatile, with the Basket at one stage losing $9.65/b in just four days.”
Adding this was a “matter of much concern”, he repeated the group’s calls for better regulation of the international financial sector.