Archived Blog Post: August 22, 2004
Oil: "Haunted by that memory, the Saudis pounced on the oil market with vigour. In the past few years, argues Mr Verleger, they have been propping up the oil price by keeping inventories down in consuming economies. By manipulating their production levels, he and other economists argue, the Saudis have ensured that firms in rich countries have had strong disincentives against holding stocks. That tightness inevitably buoyed oil prices."