What is the ruling on selling oil or any commodity, where the goods remain in their place and the exchange takes place via a device called telex?
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The questioner : Abd al-Rahman is asking about commercial matters, regarding the sale of oil or other goods, but the exchange takes place via a device called telex? So, he does not possess the goods; rather, the seller acts as an agent, buying the goods from him, and then, after the price rises in the market, and he is following it via the device, he tells him to sell.
Another questioner: No, look, who is the obligated seller? The seller is an intermediary, an agent, an intermediary who buys from the seller and sells to him.
The Shaykh : Who sets the price?
The questioner : On the screen in front of you are global prices.
The Shaykh : I know, but who sets the price? I fear there is something behind the veil that we do not know, so half of the knowledge is lacking; I do not know until we know the details of the case.
The questioner : The Shaykh’s intention may be that this mission and the Jews are behind it.
Another questioner: No, it is a stock exchange, open markets.
The Shaykh : Who, may Allah bless you, sets it?
The questioner : Supply and demand set the price; supply and demand.
The Shaykh : But this supply and demand may be artificial.
The questioner : The same thing; what can be said about this can be said about other commodities. Gold now, is it not permissible for us to sell and buy in it, with the Sharia restrictions, of course?
The Shaykh : With the Sharia restrictions, it is permissible.
The questioner : So, the issue of the drop and rise may be the Jews, because, of course, the global economy is in their hands; they may be behind this thing. But now, on the assumption that they are behind it, is it not permissible for us to sell and buy in it?
The Shaykh : By Allah, if they are playing with the prices, the matter is very dangerous. But the truth is, we must know the details of the case. I was asked this question, I think in Jeddah, and I directed this same question, but no one helped me, so it appears that there is something there.
The questioner : What is based on this question, O Shaykh?
The Shaykh : What is based on it, as is not hidden from you, is the ignorance of the price.
The questioner : How is the price ignorant? I buy with a known price.
The Shaykh : The price, as I understood, the price appears later and is not immediate, is that not so?
The questioner : No, it is a known price throughout. I can show you specific matters: I bought a tanker with one million barrels of oil, the price of the barrel was 15 dollars on that day, and the intermediary in, for example, Switzerland gave me this price, and I told him to buy for me for an amount of, for example, so much, and the money, of course, was transferred via the bank. After a week, the price rose to 18 dollars, so he said, I bought you a tanker of oil with one million barrels, and it is on the water, reserved; whenever you want to sell, sell, but before six months, because if six months pass and you do not sell, you must take delivery of the oil. If he takes it personally, he gets into trouble; how does he dispose of it? He has no warehouse or place to store it. He is told, take your oil and do with it what you wish. So, he follows the prices and has in his mind that he will sell before what is mentioned above becomes incumbent upon him. So, after a week, the price rose to 18 dollars, he told them to sell, and he profited 3 million dollars.
The Shaykh : And the barrels are in their place?
The questioner : And the barrels are in their place.
The Shaykh : This matter is not the one that was described to me. The one described to me was that they buy at the price of the barrel, or I do not know, at a price that was not clarified, but it is clarified later. As for now, the picture is different. The picture now falls under what came in the authentic Sunnah that it is not permissible for a person to sell something he bought until he takes it away. So here, he bought and sold in its place. This happens a lot in gold; a gold trader buys a quantity of gold and they agree on a certain price, then a customer comes to buy, and the goods move among three or four people or more, and the goods are parked in their place. Of course, it is not hidden from everyone that this is not permissible because it contradicts explicit hadiths.
The questioner : In one hour, it moves among five or six or ten transfers of ownership. This is not in... on the basis of commitment, a promise, it is all just a promise, meaning selling a debt for a debt.
Another questioner: No, no, in dirhams.
Another questioner: No, look, who is the obligated seller? The seller is an intermediary, an agent, an intermediary who buys from the seller and sells to him.
The Shaykh : Who sets the price?
The questioner : On the screen in front of you are global prices.
The Shaykh : I know, but who sets the price? I fear there is something behind the veil that we do not know, so half of the knowledge is lacking; I do not know until we know the details of the case.
The questioner : The Shaykh’s intention may be that this mission and the Jews are behind it.
Another questioner: No, it is a stock exchange, open markets.
The Shaykh : Who, may Allah bless you, sets it?
The questioner : Supply and demand set the price; supply and demand.
The Shaykh : But this supply and demand may be artificial.
The questioner : The same thing; what can be said about this can be said about other commodities. Gold now, is it not permissible for us to sell and buy in it, with the Sharia restrictions, of course?
The Shaykh : With the Sharia restrictions, it is permissible.
The questioner : So, the issue of the drop and rise may be the Jews, because, of course, the global economy is in their hands; they may be behind this thing. But now, on the assumption that they are behind it, is it not permissible for us to sell and buy in it?
The Shaykh : By Allah, if they are playing with the prices, the matter is very dangerous. But the truth is, we must know the details of the case. I was asked this question, I think in Jeddah, and I directed this same question, but no one helped me, so it appears that there is something there.
The questioner : What is based on this question, O Shaykh?
The Shaykh : What is based on it, as is not hidden from you, is the ignorance of the price.
The questioner : How is the price ignorant? I buy with a known price.
The Shaykh : The price, as I understood, the price appears later and is not immediate, is that not so?
The questioner : No, it is a known price throughout. I can show you specific matters: I bought a tanker with one million barrels of oil, the price of the barrel was 15 dollars on that day, and the intermediary in, for example, Switzerland gave me this price, and I told him to buy for me for an amount of, for example, so much, and the money, of course, was transferred via the bank. After a week, the price rose to 18 dollars, so he said, I bought you a tanker of oil with one million barrels, and it is on the water, reserved; whenever you want to sell, sell, but before six months, because if six months pass and you do not sell, you must take delivery of the oil. If he takes it personally, he gets into trouble; how does he dispose of it? He has no warehouse or place to store it. He is told, take your oil and do with it what you wish. So, he follows the prices and has in his mind that he will sell before what is mentioned above becomes incumbent upon him. So, after a week, the price rose to 18 dollars, he told them to sell, and he profited 3 million dollars.
The Shaykh : And the barrels are in their place?
The questioner : And the barrels are in their place.
The Shaykh : This matter is not the one that was described to me. The one described to me was that they buy at the price of the barrel, or I do not know, at a price that was not clarified, but it is clarified later. As for now, the picture is different. The picture now falls under what came in the authentic Sunnah that it is not permissible for a person to sell something he bought until he takes it away. So here, he bought and sold in its place. This happens a lot in gold; a gold trader buys a quantity of gold and they agree on a certain price, then a customer comes to buy, and the goods move among three or four people or more, and the goods are parked in their place. Of course, it is not hidden from everyone that this is not permissible because it contradicts explicit hadiths.
The questioner : In one hour, it moves among five or six or ten transfers of ownership. This is not in... on the basis of commitment, a promise, it is all just a promise, meaning selling a debt for a debt.
Another questioner: No, no, in dirhams.