Sovereign Wealth Funds Are Major Commodity Players

I’ve written pretty extensively about the role of speculators and their effect on the prices of various commodities, especially Crude Oil. I have never believed that large speculators can compete with Saudi Aramco or the NIOC – the National Iranian Oil Company – OPEC’s two largest oil producers.

Now we see that the countries themselves have been garnering very sizable revenue from commodities via their Sovereign Wealth Funds.

Reuters blog has a piece today on sovereign funds. Below is the text from the Reuters blog post.

Some interesting new data on sovereign wealth funds from State Street Global Advisors, a huge fund firm that does a lot of business with them. Most interesting, perhaps, is that the vast majority of sovereign wealth fund money comes from oil and gas revenues rather than from countries building up large foreign reserves from other trade, eg China.

* – The U.S. firm identified 37 major sovereign wealth funds worth a total of $3 trillion.
* – More than two-thirds, or 70 percent, of that money came from oil and gas interests.
* – Of the 37, all had at least $3 billion in assets.
* – Eight of them had more than $100 billion.
* – Only 13 of the 37 funds were not based on commodity wealth.
* – Asia had the largest number of SWFs at 13.
* – The 10 funds based in the Middle East had nearly half the wealth, or 46 percent, between them.

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