Similarity between crude oil and gold


Crude oil and gold, one is energy, the other is precious metal. In terms of chemical properties, the two are completely different. However, as investment varieties, both of them have certain similarities to some extent. For example, the subject matter of futures contracts is subject to certain restrictions on mining and mining, which will cause drastic price fluctuations due to the war. Let's take a look at it now.

The first is the limitation of excavation and mining. We know that some of the rich countries in the world are due to the development of science and technology, and some are purely due to the exploration of oil. For example, Norway has risen from a weak country, such as the countries in the Middle East. Why do these countries have money when they have oil? After all, oil is a rare natural resource, and it is a non renewable energy in an ultra long period of time (millions of years to form oil). Therefore, although oil can enrich the country, it can not go on indefinitely because there are restrictions. The same is true of gold. Up to now, people still recognize the status of gold as a hedging tool, because of its rare characteristics.

Secondly, the status of the two is gradually replaced. Gold was once a hard currency recognized by all countries, but since the disappearance of the gold standard in the last century, the status of gold as a hard currency has been replaced by the US dollar. Oil used to be one of the most important materials for production. In the 1970s, the economy of the United States fell into stagflation. The reason is that OPEC restricted the exploitation and supply of oil. However, scientists all over the world are producing new energy to replace oil, and the progress of science and technology has also reduced the consumption of oil in production.

Gold and crude oil, in fact, are a bit like a brother and a brother. They were once brilliant and irreplaceable, but now they are gradually replaced by other things, such as the dollar and ethanol. However, this pair of brothers and sisters still have the value of existence, so their prices have not fallen to the bottom. As the economy takes off in the future, their prices may soar for a short time, but it should also be a flash in the pan.

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