I see two possible scenarios unfolding in the near future that could lead the world Crude Oil prices to ease and perhaps fall drastically.
First, if the US Federal Reserve hikes up interest rate in the next Federal Open Market Committee (FOMC) meeting. Higher interest rate in the US will form a support for the weak US Dollar and give it some strength against other currencies. As you all know, the US Dollars and the commodities has an inverse relationship. That means, the falling US Dollars will be compensated by rising commodity prices. Rising US Dollars on the other hand will lead to falling commodity prices.
Second, if Saudi Arabia increases its oil production (or perhaps just rumours going around that they will increase production). If that actually happens, then we will be seeing falling crude oil prices. In fact, I read in a market report yesterday that they’ve agreed to raise production. Whatever it is, we’ll just wait for the OPEC meeting this 22nd June.
Man, at times like these, how I wish I had bought some Crude Oil contracts a year ago. Hahaha. So, instead of bickering about the ever-rising cost, I would instead be rejoicing over increasing wealth!
P.S. Yes, the accompanying photo of the aircraft is totally unrelated to this post 😉
Disclaimer: This article is not a specific nor general advice on managing or investing your money. This article does not constitute a recommendation nor does it take into account your investment objectives, financial situation nor particular needs.
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