|
-------- Original Message --------
| Subject:
|
OPEC Outlines Cause of Systemic Risk |
| Date:
|
Tue, 02 Jun 2009 12:50:47 -0700 |
| From:
|
"Stephen M. Apatow"
<s.m.apatow@humanitarian.net> |
| To:
|
Pascal.Lamy@wto.org, hri@int-bar.org |
Dear
Colleagues:
Systemic risk caused by speculative trading in the commodities futures
market is back in the spotlight. As the majority of G-192
countries are being
pushed to a state of complete collapse due to the return of
hyperinflation,
UN member countries are calling for emergency actions to return critical
infrastructure variables to a supply/demand based trading reality.
In the article "OPEC wants to see "paper" oil reined in" (Reuters,
2 June 2009), we read:
OPEC's Secretary General said on Tuesday more balance
was
needed between the amount of oil traded in the physical markets and the
"paper"
markets, which the group has often blamed for causing price swings.
"The
paper market should be a reasonable percentage of the physical market,
of
the real barrels," Abdullah al-Badri said at the Reuters Global
Energy
Summit.
Badri
said in June 2007, there was the equivalent of 3
billion barrels of oil being traded in
paper
markets, when 67 million barrels a day were traded in
the physical
oil markets.
He
said
it was not acceptable to have this imbalance.
"People
use it (the paper markets) as an instrument," he said.
Speculators
in the oil paper and futures markets were blamed for helping to drive
oil
prices last year to a record above $147 a barrel.
This
prompted calls from U.S. politicians for tighter regulation of oil
futures
traded on exchanges and paper markets, where derivative products based
on
oil are traded over-the-counter.
The
Organization
of the Petroleum Exporting Countries has previously said there was
a
need to control speculation and Badri reiterated there was a need for
standards.
He
said it was the responsibility of the big consumers, led by the
United States, to enforce them.
Pressure
for greater regulation has intensified after the credit crisis was
triggered
by risky credit derivatives.
Related:
Stephen
M. Apatow
Founder, Director of Research & Development
Humanitarian Resource Institute
Humanitarian University Consortium Graduate Studies
Center for Medicine, Veterinary Medicine & Law
Phone: 203-668-0282
Email: s.m.apatow@humanitarian.net
Internet: www.humanitarian.net
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