When energy analysts and investors couldn’t figure out oil markets this year, they blamed one group: algorithmic traders. On various days over the first six months of 2017, even amid signs of tightening supply, oil prices fell sharply, eventually sinking into bear market territory. Such moves confounded longtime watchers of oil, who said that based on the fundamental information, prices should have been rising. Oil investors, who make bets relying on data like production and demand, say that such forces are no longer always driving crude prices. They say program trading is distorting the market, often causing shallow price drops to accelerate.
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