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Commodity Daily News
Price of Oil Drops As Investors Avoid Risk Taking
Monday, 20 Dec 2010
The price of crude took a slight drop in overnight trading, falling around 30 pips to its current level of 88.68. The drop can be attributed to an increase in risk aversion following the confusion regarding the Irish bailout. Typically, commodities like crude oil move up when positive news causes investors to bet on riskier assets.
That being said, the price of oil is still close to its highest point in two years. Predictions remain that another jump in price could occur, especially as the weather in the US gets colder, thereby increasing energy demand. It appears that while crude may be falling in the short term, its long term prospects are still bullish.
