The problems with consumerable commodities continue with rallies across the board led by Crude Oil (up for the fifth day in a row).
The Brent Crude Oil spread is now at $104.96 - $105.01 down a bit from last nights close but not particularly violent in early action. Yesterday 50 cent ranges came and went on a moment by moment basis and it was an almost impossible market to trade sensibly. Hopefully today will see a little stability return but I am not holding my breath.
Crude Oil went walkabout on the announcement that there was no help to be found from OPEC and just for once you can see their point. They have a finite amount of the black stuff (albeit enough at current extraction rates to last another century) but they probably see no reason to perpetually increase supply merely to reduce the price of virtually their only export and at the same time reduce the longevity of the product itself.
As oil reaches higher levels the price hike should create its own brake on increased use. In the UK a Litre is now around 105 - 110p, much more would almost certainly have those with alternative transport choices think in terms of a change. In the States where (perversely) the lack of high taxation means that petrol prices are much more directly influenced (on a percentage basis) by the cost of Oil the impact may be even greater.
Crude Oil Spread Betting, 10 Mar 08
Crude Oil is also just shy of another record high and clients seem to be increasingly trying to pick the top. Inventories have been propping up the market and for all money that clients are giving up on oil, they are making back on gold.
Crude Oil Spread Betting, 4 Mar 08
Crude Oil went walkabout yesterday with the price for Brent shooting up to $102.30 before slumping back to under $100. The Crude Oil spread and is currently at $100.40 -$100.45. The price action looked very much like a bear squeeze taking out weak sellers and may be the signal for a bit of a sell off. Having filled up my gas-guzzler at the weekend, and being stung for over £100 for the privilege, one can but hope!
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