Crude Oil Effect On Forex Market

Crude Oil All Time High

Global uncertainty has driven crude oil prices to historically high prices in the last few days, hitting the 90$ per barrel psychological barrier. The speculation of a war between the USA and Iran, a possible Turkish confrontation with Iraq are two of the main factors that are helping speculators to drive prices higher.

The most affected currencies for this situation have been the CAD and the JPY. This is mainly because Canada is one of the biggest crude exporters and refiners of the world, making the CAD go strong and higher. On the other hand, Japan is one of the biggest crude importers, so that has affected negatively the JPY.

Keep track of what's really happening around the black gold market. View our Futures Energy section. And if you want to see the effects on the currencies check our Rates and Charts section.

• US Energy Information Administration (EIA)
• US Department of Energy (DOE)

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Canadian Dollar Strengthens on Stocks & Oil Prices

The Canadian dollar strengthened today as the gains of the global stocks and the rising oil prices spurred the demand for the currencies related to the economical growth.

The Standard & Poor’s 500 Index rose 1.6% and The MSCI World Index gained 1.4%. Crude oil, Canada’s key export, jumped as much as 1.9 percent to $76.63 per barrel on the New York Mercantile Exchange. The manufacturing sales grew 0.1% in June, following the 0.5 percent advance in the month earlier. The forecasts predicted the decline by 0.4%.

David Watt, senior currency strategist at the Royal Bank of Canada, described the situation:

We’ve got equities that are up and tensions that have been building through the global financial system have certainly eased. That’s given a fillip to all risk-sensitive securities

USD/CAD slumped from 1.0432 to 1.0315 today as of 16:31 GMT. EUR/USD fell from 1.3379 to 1.3282 after it rose to 1.3423.

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