Understanding the relationship between crude oil prices and inventory levels is critical for policymakers and economic actors. The size of the ‘basis,’ or spread between spot and futures prices, reflects the level of inventories and can trigger arbitrage trading. The basis also reflects broader underlying market conditions and can be useful to policymakers such as the International Energy Agency and OPEC attempting to monitor and stabilize world oil markets.February 24, 2020
Abdullah is a research analyst in the Markets and Industrial Development program, with a focus on oil markets and energy policies. He is a recent graduate who previously completed an internship at Halliburton’s research and development center in Dhahran, Saudi Arabia.