The prices of crude futures have been very unpredictable in the past like the prices of some other commodities.
Crude oil commodity trading will see price sway in both directions; forward and backward. This may be for the reason that of a shortage of crude or oversupply of the commodity.
When crude oil trading is carried out, awareness is required that the price cycle of the commodity is not for a short term.
The cycle may extend to days or even years. Changes in the demand of the commodity, the supply from OPEC and non-supply from OPEC play a key role in deciding the trend and hence the price of crude oil.
Geopolitical events, along with supply and demand for the commodity, have seen a lot of price instability in the past.
Trading online makes the progression very transparent and opportune.
An outlook on the history of crude
In the twentieth century, the price of crude was very profoundly regulated.
Production of price control kept it under stern regulation. In the United States, after the World War II, the crude prices were restricted by the government.
However, if the price had not been restricted, the crude prices would have been much higher.
It was quoted at $28.52 per barrel under regulation and on the other hand the world average price was $30.54 per barrel.
The OPEC had kept the crude prices in the $22-$28 price range till March 2000.
The real prices of crude only could exceed $30 per barrel in the case of any turbulence or war.
On the other hand, when it had limited spare capacity, it dumped the price band in the year 2005.
A Long term outlook of crude
The industries in the upstream of the crude industry ought to be able to profit below $25 half of the time.
The raise in the interest rate of oil futures and OPEC regulations will always play a major role in impacting crude oil future prices.
Crude is a very prevalently traded commodity in the Indian commodity exchange.
Understanding the price history of crude and the events that impact the price of crude can let you take a good trading decision when trading the crude futures.