Wheat price goes up as oil price falls, being true to old cliche: one man's loss is anothre man's gain!

wheat and oil price

 

With the unprecedented surge in Coronavirus infections in India, exacerbated by the lack of medical oxygen in hospitals and the scarcity of beds, the oil price fell on Monday, having been subjected to the inevitable volatility in the markets.

Making matters worse, the pandemic situation in Japan also has become a serious cause for concern: some prefectures are in lockdown, covering a quarter of the population, including the major cities such as Tokyo and Osaka.

India and Japan in pandemic


As the word’s third and fourth crude oil importers struggle to cope with the new danger, markets sentiment has gone down considerably: both WTI crude and Brent crude fell on Monday, reflecting the evolving sentiments in the crude oil markets.

In addition, the anticipated increase in the output by the OPEC+ in May must have played some role in the market sentiments too.

In India, meanwhile, there is a significant drop in activities at the pumps; the prices of petrol and gas have not changed as demand has plummeted.

As the oil price started going down due to the pandemic, the wheat price has gone up steeply; oil investors, perhaps, may have turned to yet another essential commodity at a time of a serious global health emergency.

With regard to the global experience during the past two waves of the pandemic, the positive sentiments do return to the markets in dribs and drabs in proportion to the recovery that usually takes a couple of weeks; crude oil price recovered even after going negative for the first time in history.

Judging by the way authorities in Australia, Taiwan, New Zealand and even China handled the crisis offers us hope at a time of lingering anxiety that things could be turned around with the right leadership combined with public corporation.

Comments

Popular posts from this blog

Oil price closer to $70 a barrel: it's more realistic, sustainable and better than pursuing unrealistic goals

Oil Price and Lingering Suez Factor

What caused the downward trend in crude oil price?

Crude Oil: latest news