Liam Denning, Columnist

OPEC's Casual Relationship With Hedge Funds

Oil speculators are helping the cartel, but at a price.

January 18, 2018 at 2:15 PM UTC

Updated on

January 18, 2018 at 3:45 PM UTC

Liam Denning is a Bloomberg Opinion columnist covering energy. A former banker, he edited the Wall Street Journal’s Heard on the Street column and wrote the Financial Times’s Lex column.

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OPEC has a complicated relationship with hedge funds.

Historically, the oil exporters' club routinely blamed "speculators" for moving oil prices too far this way or that relative to fundamental supply and demand. Let's breeze past the irony of an organization artificially restricting supply bemoaning others for interfering with the purity of the price-setting mechanism. Instead, let's recognize OPEC is getting a helping hand from hedge funds -- albeit one that comes at a price.