A view of crude oil
Crude oil has had a tough year, one underlined by prolonged periods of high fluctuation and steady declines, culminating in massive drops for the commodity oil just last month. The instability which the commodity oil displayed has turned off investors, who deemed crude oil as being too vulnerable and risky, forcing them to instead flock to safer havens, like gold and the U.S. dollar. With the ongoing debt crisis in Europe, one of the primary factors affecting crude oil investments, seemingly unresolved, the commodities market were readying to sustain another series of losses.
Yet over the past week and a half, crude oil futures have rallied up the commodity index, posting impressive gains and managing to recoup most of the losses they suffered in the previous months. Though the debt situation in Europe continues to spiral out of control, it was relief on the domestic front that bolstered crude oil prices and crude oil investments and breathed new life into the raw commodities market.
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Optimistic reports from both the U.S. Commerce Department and Energy Department gave crude oil futures a massive boost last week, with the nation’s crude oil inventories on a sharp decrease, and both retail sales and industry production soaring. These factors paint a picture of a nation heading up a path toward economic recovery, albeit a slow and patient one.
The oil commodity futures on the European front received support from another source, when several prolific crude oil suppliers from the Middle East halted exports amid political unrest and strikes. China’s booming economy should also give crude oil investments a bump up the commodity index.
However, with all these factors at play, the most vital part of crude oil’s path toward full recovery and future profits is an adequate and effective resolution measure for the rapidly spiralling debt crisis affecting Europe. The commodities market now waits patiently and eagerly, as the region’s leaders prepare to unveil their five point detailed plan on October 23rd. The immediate future of crude oil prices and crude oil investments rests in that summit.
U.S. crude oil futures currently sit above $88 per barrel in New York, while Brent crude oil prices hover above $111 in London.