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WASHINGTON, US - THE Opec cartel called on Saturday for tougher regulations to reduce the impact of speculative investment in the oil market which it blames for the huge volatility in crude prices.
Oil peaked at a record high above US$147 (S$218) in July but has since plunged back below US$80 a barrel as the financial crisis rocking markets slows economic growth and so demand for energy.
'The world oil market has been increasingly affected by financial market shocks from outside the physical oil market,' Opec spokesman Alipour-Jeddi told the International Monetary Fund meeting in Washington.
'The recent wild (price) swings demonstrate the need for concerted action to reduce the impact of financial markets which are damaging for the oil industry, as well as the global economy as a whole,' he said.
'The existing regulatory framework has proved insufficient to properly contain the negative impact of speculative activity ... which highlights the need to consider further measures.'
Mr Alipour-Jeddi specifically called for the tightening of regulation on speculative trading practices and an extension of US market monitoring.
As oil prices soared in the first half of the year, the United States led a chorus of countries in the West wanting Opec to increase output - which it agreed to - in order to ease the pain.
As prices have since tumbled, some Opec members, most recently Libya, have called on the group to cut output to support prices. -- AFP
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