Investors should never forget crude oil

SHOULD crude oil rise to $90 per barrel by the end of 2022, then it will be noticeable in several economies around the world. If the potential price increase happens in a steady trend, the drama decreases somehow and this surely is a possible scenario. Almost all developments in the financial markets that put pressure on economies typically do not appear in neat, smooth movements.

With the current expectations about supply and demand for oil, the risk is more of a jump in oil prices. Such price jumps can cause turbulence in the financial markets in general and I expect this to be an additional reason why volatility in all financial markets will increase during the next 12 months. The most important counterweight to such unfortunate developments in the short term is to increase the oil production, which has traditionally been the result after drastic increases in the oil prices - although even higher production does not change the belief in an oil price that rises above $100 per barrel, at least if one listens to several of the top people in the oil market.