The Simple Economics of Commodity Price Speculation

Christopher R. Knittel and Robert S. Pindyck

April 2013

Chris R. Knittel and Robert S. Pindyck

The price of crude oil in the U.S. had never exceeded $40 per barrel until mid-2004. By 2006 it reached $70 per barrel, and in July 2008 it reached a peak of $145. By the end of 2008 it had plummeted to about $30 before increasing again, reaching about $110 in 2011. Are "speculators"

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