Libyan unrest sends commodity prices up
Posted Mar 1, 2011 9:05 pm.
This article is more than 5 years old.
Oil and gold are surging on the markets due to the unrest in Libya.
The price for a barrel of crude almost hit the triple digits, ending the day at $99.63 U.S.
In the meantime, gold shattered its previous record to finish at $1,431.20 U.S. an ounce.
If the unrest in Libya and the Middle East spreads to Saudi Arabia or Iran, crude prices could hit $120 U.S. a barrel, according to Scotia Capital Economist Derek Holt.
He says there’s no real danger to the global economy if crude hits that mark briefly, but if oil sustains a price like that, it will spark fears of another worldwide recession.
“We could be in for a wild ride,” he says. “The hope is that things will settle down soon and that prices will return closer to fundamentals, in the case of oil, probably somewhere in the 90 to 95 dollar range is something consistent with supply and demand.”
He says because we don’t know how or when the uprisings are going to end, there’s no way to tell where commodity prices are going to peak or how likely it is that prices will hit the $120 U.S. danger zone.
