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Oil prices rallied to a two-year high above $64 a barrel, up about 40% since early June, amid rising Middle East tensions. Market speculators are pointing to $70 a barrel by year end.
Higher crude oil lifts biofuel and input costs and can support vegetable oil and dairy prices, with oil-economy demand for dairy also cited as supportive.
farmersjournal.ieLorcan AllenNov 8, 2017After 626 past bullish geopolitics events, Crude Oil (WTI) moved a median +2.1% over 5 sessions (62% higher; middle half -2.3% to +8.5%), and +1.6% over 20.
After 656 past bullish geopolitics events, Crude Oil (Brent) moved a median +1.9% over 5 sessions (63% higher; middle half -2.7% to +6.6%), and +0.7% over 20.
After 110 past bullish geopolitics events, Soybean Oil moved a median +1.8% over 5 sessions (65% higher; middle half -0.7% to +3.6%), and -0.4% over 20.
After 373 past bullish events of any kind, Milk (Class III) moved a median 0.0% over 5 sessions (50% higher; middle half -0.5% to +1.0%), and +1.2% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
Reports of oil rallying to a two-year high above $64 amid rising Middle East tensions describe the geopolitical risk premium that likely drove the surge, but the article is dated after the move so it is confirmatory rather than causal.
