While many a wars have erupted for Crude Oil—a scenario where oil boiled turmoil—this time around, it is the other way around. Turmoil is boiling Oil!
In other words, panic, rather than fundamentals are driving the oil prices. Many analysts peg oil price at $220 a barrel if Libya and Algeria fail to supply their quota of oil!
In fact, Brent climbed above $119 per barrel in the ICE Futures Europe exchange which is highest figure since Aug. 21, 2008.
Now, consider a few primary school facts:
Libya is 'only' the twelfth largest oil producer in the planet. Algeria ranks under Libya in production.
Though Libya is a prime exporter of oil to Europe, it is not the only producer to do so and European countries can source oil from many quarters, including Russia.
So what is pushing up the prices, if not panic?
When the crisis hit Egypt, it was more realistic to assume that oil prices would rise given the sensitivity of Suez Canal region through which a significant amount of oil gets transported.
May be some Yoga could help the markets!
