Sticky substance with sticky power: Oil in global production and financial networks

To analyse oil, the world’s most traded commodity, we combine Global Production Network (GPN) and Global Financial Network (GFN) approaches into the Global Production and Financial Network (GPFN). The combination offers a dynamic framework, as key actors and geographies in the GPFN change over time. It brings together the production and financial strands of research on oil and overcomes the physical reality v. financial fiction dichotomy in literature. Using a wide range of data on oil networks, prices, historical accounts, as well as industry, media and policy reports, we apply the GPFN to explain the evolution of oil networks, since their inception, as well as the mid- and short-term price anomalies since 2010. Our history of oil GPFN demonstrates the stability of its analytical categories and the stickiness of power wielded by some actors and geographies, while others come and go. Our account of price anomalies shows the inseparability of physical and financial factors in explaining them. As whole the GFPN is an opportunity to understand the evolving broad structures, distribution of power and price formation in markets, and as such represents a way forward for studying other products and sectors.