The current oil market volatility causes problems for both producers and consumers, because it reduces their ability to plan ahead, said Nordine Ait-Laoussine, President of Geneva-based Nalcosa and formerly energy minister of Algeria. He questioned whether markets would continue to be “led by fear” or will return to being driven by “tangible realities.” The extent to which the oil industry has had to adapt of late has been “really striking,” said Mr Ait-Laousssine. “The past decade has been anything but boring. We live in a world in which game-changing events have become the normality.”
OPEC Secretary-General ‘Abd Allah al-Badri said that the market is well supplied and stocks are high, with 59 days of forward cover – two days more than normal. “Nobody in the world is going short of oil,” he said. “OPEC is producing more than 31mn b/d and we have spare capacity. In 2013 we will reach 3.4mn b/d of spare capacity. I don’t see why we have high prices. As always, I would have to say that speculation is the problem. But speculation is a part of the market that no-one can eliminate. The paper market is three times the size of the physical market – something is wrong here. OPEC is not asking to remove the paper market, but the IEA and OPEC are not here to set policy – that is for government.” (CONTINUED - 982 WORDS)
