The paper creates a simple analytical framework based upon supply and demand curves to define what is meant by micro-managing oil markets. This framework is then used to explain why OPEC faces increasing difficulty in attempting to micro-manage markets. The problems are identified as deteriorating information plus a lack of knowledge by the market players. The paper then considers how it might be possible to overcome these difficulties. It concludes this would be extremely difficult. Finally, it considers how the inevitably worsening price volatility might be managed.
|Number of pages
|Journal of Energy and Development
|Published - 2001
- Global oil markets
- Oil price volatility
- Organization of Petroleum Exporting Countries (OPEC)