Commodity Daily News

Oil Plummets after Demand Expectations Flounder

After failing to breach the $60 mark twice this week, the price of Crude Oil unexpectedly dropped during yesterday's trading. Due to a sudden drop in Oil imports, the price of Light Sweet Crude plummeted to just under $58 a barrel after peaking at $60.04 on Monday, the highest it's been since November.

According to economic analysts, two factors played an important role in the price of Oil these past days. The decreasing strength of the U.S. Dollar no doubt generated a moderate bullish run in the price of Crude Oil as market optimism reigned supreme. This optimism generated a perception of economic growth and the belief that demand for Oil would increase in the near future. However, when the demand side didn't materialize, the positive euphoria vanished and prices dropped to reflect their true value. As such, we may see a continuation in the bearish movement of the price of Crude Oil in the coming hours, but if optimism returns, the upward movement may continue.