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Dollar overtakes supply and demand fundamentals

For both the crude and natural gas markets, the dollar has played a significant role in trading activity in 2009. Supply and demand took a back seat as oil traders were forced to focus on the intricacies of currency exchange rates and global macroeconomics and the relationships therein, observed Phil Flynn, vice president at futures trading firm PFG Best.

It is predicted that in the first quarter of 2010, the price of crude oil will still be driven by outside forces, but supply and demand could resume a more significant role by the second quarter. Oil prices could then be more fundamentally driven and more aligned with supply and demand.


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