Speculation in international crises: report from the Gulf

Recent years have seen recurring international financial crises, as well as a tremendous rise in trading and speculation. How are the two related? Are speculators and trading responsible for market volatility? This paper presents a study of the Gulf Crisis of 1990–1991, examining the behavior of the international oil market during a period of unprecedented volatility. The analysis suggests that a combination of political events and market fundamentals, rather than trading, was behind this volatility. Journal of International Business Studies (2005) 36, 576–587. doi:10.1057/palgrave.jibs.8400158