Crude oil dives down to 70 dollars
Crude oil prices clearly reflect the state of the global economy both in economic terms and political terms. When there is smooth and steady growth of the global economy, then the crude oil prices keep marching ahead. And whenever there are major political upheavals in any part of the world, the crude oil prices start marching ahead in the immediate term.
And when the political upheaval starts hitting the global growth, then over the longer term the crude oil prices keep going down.
And this week, the crude oil prices are near the 70 dollars mark, thanks to the Greece financial crisis. The Greece financial problem is now snowballing into a big European Union tussle, which can easily pull down the entire European region growth for many quarters to come.
And the naked short sales ban by Germany unilaterally has also forced many speculators to get out of crude oil forward positions. So there are many analysts who are expecting the crude oil prices to remain in the 60 dollars to 80 dollars band for the rest of the year 2010.
Subsequent price movement of crude oil will obviously depend on the overall global recovery.