Inside Trade | Black Gold

The technological revolution walked hand-in-hand with the demand for oil. The unquenchable demand has been running for years, depleting the vast supply of oil reserves all over the world and won't stop till the last drop. Turmoils and disputes rose when powers strangle each other to control this almost extinct commodity. The recent disputes on the Spratly islands was rumored to root on the vast oil reserves on some of the islands. It was also rumored that the intervention of some notable countries in the middle eastern affairs was also due to the control struggle on the oil resources.

Oil, also known as Black Gold, has a very great influence on the currencies because it makes the economy running. United States is one of those who has a very high demand for oil. So as a rule, when the oil prices go up, the dollar falls down and vice versa. USD being one of the major currency, influences the Forex market in return.

However, countries which exports oil, Canada for one, will have a positive impact whenever the price of oil increases. The great influence of oil on world economy makes it a very vital item for fundamental analysts.