Oil Falls again Despite a Weak Dollar
Crude Oil continued its decline for the fourth consecutive trading session following Bernanke's speech and estimations for lower inflation and a weak U.S. economy. The price of Crude ended the day down at $74.14 after an opening price of $75.60. This was a price drop of almost 2%. Today's weaker dollar may have helped to lessen the price drop in Crude.
The price may have also been influenced by weak fundamentals in the Crude Oil market. There may still be an excess amount of supply in the market that has yet to be reduced with lower demand due to the slowing global economy.
The positive from yesterday may be in Bernanke's speech. As long as inflationary pressures are muted, the Fed will continue to hold Interest Rates low. This could be a positive factor for the price of Crude Oil. A higher Interest Rate would be dollar positive, thereby potentially pushing crude oil prices lower.
The price may have also been influenced by weak fundamentals in the Crude Oil market. There may still be an excess amount of supply in the market that has yet to be reduced with lower demand due to the slowing global economy.
The positive from yesterday may be in Bernanke's speech. As long as inflationary pressures are muted, the Fed will continue to hold Interest Rates low. This could be a positive factor for the price of Crude Oil. A higher Interest Rate would be dollar positive, thereby potentially pushing crude oil prices lower.
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