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Triple-Digit Oil Prices Here to Stay
Investors will quickly become accustomed to triple-digit oil prices as the world economy becomes weaker and raw materials markets promise increasing profits, Reuters observes. Oil prices reached a new record level February 20 when IPE Brent Crude sold for $98.42 per barrel on London's InterContinental Exchange Futures and Light, Sweet Crude sold for $100.74 on the New York Mercantile Exchange. March futures are selling at $101.32 per barrel.
Most analysts say the rally will continue. Raw materials are the most popular insurance against inflation and market volatility right now. Experts say that the rise in oil prices was brought on by corrections on stock exchanges and more speculative capital can be expected to be placed on the raw materials market as the year continues.
The price for a barrel of oil has not fallen below $86.11 since the beginning of the year and the price can be expected to rise all year. Political tensions in major oil exporters Venezuela and Nigeria also reinforce that tendency. Analysts note that the extent of the price rise depends largely on extra-market factors, so it is hard to predict how high prices may go.
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Photo: Reuters
