The role and impact of commodity market institutions in the determination of oil prices

Journal Article · Thu Dec 31 23:00:00 EST 1987 · Annual Review of Energy; (USA)

DOI:https://doi.org/10.1146/annurev.eg.13.110188.002043· OSTI ID:6842072

Verlegar, Jr, P K ^[1]

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1. Inst. for International Economics, Washington, DC (US)

The emergence of commodity market institutions in oil is examined in this paper. The demand for futures markets, an increase in trading, and other mechanisms for shedding risk are shown to have been created by changes in the structure of the world oil market. The primary contributors to these changes were the nationalization of the holdings of the multinational companies, changes in tax regimes in certain oil-consuming nations, removal of controls in consuming nations, and an increase in uncertainty about demand. These changes created a felt need for commodity market institutions. In addition, the following factor was required: the inability of the members of the Organization of Petroleum Exporting Countries (OPEC) to set and adhere to realistic output ceilings. It is suggested that the continued survival--let alone further growth--of these markets depends on OPEC's pst and prospective inability to control production.

• OSTI ID: 6842072
• Journal Information: Annual Review of Energy; (USA), Journal Name: Annual Review of Energy; (USA) Vol. 13; ISSN 0362-1626; ISSN AREND
• Country of Publication: United States
• Language: English

Related Subjects

02 PETROLEUM
020700* -- Petroleum-- Economics
Industrial
& Business Aspects
29 ENERGY PLANNING, POLICY, AND ECONOMY
290200 -- Energy Planning & Policy-- Economics & Sociology
294002 -- Energy Planning & Policy-- Petroleum
ECONOMIC IMPACT
ENERGY SOURCES
FOSSIL FUELS
FUELS
GLOBAL ASPECTS
INTERNATIONAL ORGANIZATIONS
MARKET
OIL-EXPORTING COUNTRIES
OPEC
PETROLEUM
PRICES
SUPPLY AND DEMAND