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An oil refinery is silhouetted against the setting sun April 24, 2008 in El Dorado, Kan.
An oil refinery is silhouetted against the setting sun April 24, 2008 in El Dorado, Kan.
(Charlie Riedel/The Canadian Press)

Reasons to fear a stable oil price

The price of oil has been doing something really extraordinary. It has hardly moved for several years. That stability probably contains the seeds of its own destruction.

A barrel of Brent goes for $110 (U.S.). At 5 per cent above the low of the last year, and 5 per cent below the high, this is the narrowest 12-month trading range for oil since at least 1988. The recent experience is not a fluke. Oil has been remarkably steady since early 2011. The lower volatility is tough for speculators. For users, it is more mixed. They would prefer a lower price, of course, but like the predictability.