After hitting a 5-month high above $84 a barrel, oil prices today dropped as investors looked at supply and demand rather than only the collapsing U.S. dollar.
That's not to say the weakening U.S. dollar isn't a factor, just that it's not the sole factor in oil price movements. No matter how weak the dollar is, consumers still must buy gas and oil in order to push prices up to high levels.
This is how it's going to go for some time into the future, not just for oil prices, but for commodity prices in general. Those moved by supply and demand, coupled with the drop in value of the U.S. dollar will do very well for some time.
After reaching $84.43 today, crude oil pulled back for November delivery to below $83. As of 1431 GMT, it stood at $82.83.
The push and pull of supply and demand versus the falling U.S. dollar will have oil and commodities performing in this manner going forward, as the market looks for a balance between the two.
In the short term at least, it is expected that oil prices will pull back more.
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