Hedging Government Oil Price Risk
Many governments are heavily exposed to oil price risk, especially those dependent on revenue derived from oil production. For these governments, dealing with large price movements is difficult and costly. Traditional approaches, such as stabilization funds, are inherently flawed. Oil risk markets could be a solution. These markets have matured greatly in the last decade, and their range and depth could allow even substantial producers, and consumers, to hedge their oil price risk. Yet governments have held back from using these markets, mainly for fear of the political cost and lack of know how. This suggests that the IMF, together with other development agencies, should consider encouraging governments to explore the scope for hedging their oil price risk.
|Date of creation:||01 Nov 2001|
|Date of revision:|
|Contact details of provider:|| Postal: International Monetary Fund, Washington, DC USA|
Phone: (202) 623-7000
Fax: (202) 623-4661
Web page: http://www.imf.org/external/pubind.htm
More information through EDIRC
|Order Information:||Web: http://www.imf.org/external/pubs/pubs/ord_info.htm|
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Peter Wickham, 1996. "Volatility of Oil Prices," IMF Working Papers 96/82, International Monetary Fund.
- Paul Cashin & Hong Liang & C. John McDermott, 2000.
"How Persistent Are Shocks to World Commodity Prices?,"
IMF Staff Papers,
Palgrave Macmillan, vol. 47(2), pages 2.
- Hong Liang & C. John McDermott & Paul Cashin, 1999. "How Persistent Are Shocks to World Commodity Prices?," IMF Working Papers 99/80, International Monetary Fund.
- Engel, Eduardo & Valdés, Rodrigo O., 2001.
"Optimal fiscal strategy for oil exporting countries,"
Sede de la CEPAL en Santiago (Estudios e Investigaciones)
34818, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
- Rodrigo O. Valdes & Eduardo M Engel, 2000. "Optimal Fiscal Strategy for Oil Exporting Countries," IMF Working Papers 00/118, International Monetary Fund.
- Eduardo M.R.A. Engel & Rodrigo Valdés, 2000. "Optimal Fiscal Strategy for Oil Exporting Countries," Documentos de Trabajo 78, Centro de Economía Aplicada, Universidad de Chile.
- repec:idb:wpaper:307 is not listed on IDEAS
- Arrau, Patricio & Claessens, Stijn, 1992. "Commodity stabilization funds," Policy Research Working Paper Series 835, The World Bank.
- Paul Cashin & C John McDermott & Alasdair Scott, 1999.
"Booms and slumps in world commodity prices,"
Reserve Bank of New Zealand Discussion Paper Series
G99/8, Reserve Bank of New Zealand.
- Ricardo Hausmann, 1995.
"Dealing with Negative Oil Shocks: The Venezuelan Experience in the Eighties,"
IDB Publications (Working Papers)
5722, Inter-American Development Bank.
- Ricardo Hausmann, 1995. "Dealing with Negative Oil Shocks: The Venezuelan Experience in the Eighties," Research Department Publications 4010, Inter-American Development Bank, Research Department.
- Varangis, Panos & Larson, Don, 1996. "Dealing with commodity price uncertainty," Policy Research Working Paper Series 1667, The World Bank.
- Claessens, Stijn & Varangis, Panos & DEC, 1994. "Oil price instability, hedging, and an oil stabilization fund : the case of Venezuela," Policy Research Working Paper Series 1290, The World Bank.
- Manmohan S. Kumar, 1992. "The Forecasting Accuracy of Crude Oil Futures Prices," IMF Staff Papers, Palgrave Macmillan, vol. 39(2), pages 432-461, June.
When requesting a correction, please mention this item's handle: RePEc:imf:imfwpa:01/185. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Jim Beardow)or (Hassan Zaidi)
If references are entirely missing, you can add them using this form.