How are you reading the oil story right now?
Brent has traded above $100 through September on supply disruption (report), and the IEA expects demand to fall next year (report).
Post your synthesis:
- supply versus demand: which wins in your view
- how oil is feeding inflation and CAD/NOK
- the levels you're watching
Background: oil and the Canadian dollar.
Background: Oil and currencies: why crude prices move the Canadian dollar
Crude oil links energy markets to currencies through trade, inflation and interest rates. How that works for the Canadian dollar, and why the link isn't fixed.
Why does oil affect the Canadian dollar?
Crude oil is one of Canada's largest exports. Higher prices increase export earnings and demand for Canadian dollars, and they also affect inflation and interest rate expectations.
Does USD/CAD go down when oil goes up?
Often, because a stronger Canadian dollar pushes USD/CAD lower. But the relationship isn't fixed: interest rates, trade relations and risk sentiment can outweigh oil.
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