The less liquid market is thus more prone to wild price swings, as seen in just two weeks, in which oil jumped and slumped by $40 a barrel in both directions.
There’s much more volatility ahead in the near future, analysts and investment banks say.
Portfolio managers cut their bullish bets on Brent Crude by the most in years in the week to March 8, according to data from futures exchanges.
Even one of the largest independent commodity traders, Trafigura, is reportedly looking for financing outside its usual pool of banks, Bloomberg reported this week, citing sources with knowledge of the matter.
“To say that oil prices have been volatile recently would be an understatement,” analysts Martijn Rats and Amy Sergeant at Morgan Stanley wrote in a note carried by Bloomberg.