Rus News Journal

The oil market became investment

Players are protected from share risks
the oil prices

on April, 1st OPEC session should take place. But what on it will be accepted decision - to reduce extraction (it is a seasonal measure, characteristic for oil manufacture in the second quarter) or it to increase, - not essentially. The oil market has turned from the commodity market where the price develops of supply and demand, in the market of investments.
still on February, 10th, 2004 noticed that on 13 - a summer maximum of the price for oil growth of commercial stocks of oil in the USA can lead to a slump of prices at leading world oil stock exchanges. This paradoxical at first sight event occurs right now. So, after the message on March, 24th about growth of stocks of oil in the USA on 7,5 million barrels for a week on March, 25th the price for oil of mark Brent in London has fallen to 3,6 %, on Light Sweet in New York - on 4,2 %. The explanation can be found, having addressed to the American securities market. And there on March, 25th after five sessions of falling of quotations growth has renewed. Rates of increase of index NASDAQ were the highest for last nine months: following the results of day the index has jumped up on 3,02 %.
Thus, speculative character of the market of oil once again proves to be true. It is not so commodity market, not the consumer market - and the market of the investor. The parity of investors and real buyers of oil is strongly displaced towards the investor. That price indexes on oil and the prices for actions and bonds change in opposite directions, does the oil market especially attractive to the investor. At falling of stock market investors translate means from financial tools in the exchange goods, at growth - on the contrary.
Now it is possible to say with confidence that falling of the prices for oil in November, 1997 has been caused by previous excessive growth of stock quotes in stock markets of the USA. After in the end of 1999 this bubble has started to be blown off, the same bubble was inflated in the future markets of raw materials, including in the oil market. It has lifted demand for oil on spotovom the market and, accordingly, its price. And force of this bubble allows and to hold now the high price for oil in spite of the fact that the oil offer in the world market (82 million barrels a day) considerably surpasses demand for it (79 million barrels a day). In the second quarter the further seasonal reduction of demand for 1 million barrels a day is expected.
this reduction of the OPEC assumes to compensate corresponding decrease in quotas. However today`s experience speaks well for that the bubble in the oil market can keep the high price and in the event that decrease in quotas will not occur. Understanding it, the OPEC countries at conference in Vienna can delay on April, 1st introduction of the lowered quotas for one quarter. Such situation is fraught sharp shlopyvaniem a bubble if investors prefer to the market of oil stock market. The matter is that OPEC quotas is a support of the market of oil. When investors will start to deduce money from oil, the prices for it will fall to the level defined by supply and demand in the world market of oil, that is in many respects OPEC quotas. And the behaviour of stock market in the USA reminds recently its behaviour before falling of the prices for oil in November, 1997. So, index Dow Jones for last year has grown on the same 2000 points, as well as one year prior to November, 1997. It is not excluded that the begun falling of euro in relation to dollar will give to confidence to investments in stock market in the USA and by that will start the mechanism of falling of the oil prices.