The Department of Energy Could Make Better Use of Existing Data To Monitor the Crude Oil Spot Market

As the world price of crude oil more than doubled in the last 2 years, spot crude oil prices rose even higher. Spot market activity appeared to increase to unprecedented volumes. The significance of the spot market lies not only in its size and price trends, but in its relationship to the far larger contract market. Both oil-exporting and oil-importing countries pointed to the spot market when contract prices dramatically increased. It is alleged that the spot market created an illusion of scarcity, artifically inflated demand and racheted crude oil contract prices to higher levels than they would have otherwise climbed. By mid-1980, the spot market appeared to be stabilizing, but conditions underlying its volatility remain.