Since OPEC’s last meeting on the 11th December 2010, the market has been marked by high levels of volatility and an upward trend in prices. On several occasions in April 2011, the price of oil topped US$120 a barrel.
HE Mohammad Aliabadi, Acting Minister of Petroleum for Iran and President of the Conference in Vienna said there was a host of reasons for instability in the oil markets: “The early onset of winter had an initial impact on the situation. So did forecasts of a quicker-than-expected rise in oil demand and a surge of investment flows into commodity markets, including crude. However, the market outlook has been dominated more recently by the political developments in the Middle East and North Africa. There has also been the triple disaster in Japan.”
“There are still some notable points of concern. These include the persistently high level of unemployment, the sovereign debt crises in major OECD countries, potential overheating in many emerging economies and rising inflation across the globe.
Despite it being a “nervous six months” for the oil market, Mr Aliabadi said: “the world remains well-supplied with oil, with ample spare capacity and adequate stock levels.”
He said that the financial sector had a responsibility to its affects on world economics: “Excessive speculation in the futures markets increases volatility unrelated to fundamentals and efforts by governing and regulatory bodies in the consuming countries to minimize such speculation remain imperative.”