What is the relationship between the US dollar exchange rate and the price of crude oil?

In fact, crude oil is an important factor affecting the exchange rate of the US dollar. Today, I'd like to talk about the relationship between the exchange rate of the US dollar and the price of crude oil. If you are interested, please come and learn about it~

1. Crude oil is one of the most important physical commodities in the world. As one of the commodities with the largest trading volume in the world, the price of crude oil has always been closely linked with the exchange rate of US dollar, and its delivery and pricing are basically settled in US dollars, so the exchange rate of us dollar will also affect the price of crude oil. The oil crisis in the 1970s was a sharp rise in OPEC's international oil prices, accompanied by a sharp decline in the US dollar exchange rate. This reflects the decline in the value of the dollar as a unit of oil pricing. As a strategic handicraft, crude oil is greatly affected by the basic relationship between supply and demand. The fluctuation of crude oil price is influenced by many factors. Besides politics, economy and weather, the influence of US dollar exchange rate is also an important factor.


2. The relationship between crude oil and US dollar is different from that of gold and US dollar. The price of gold is influenced by the exchange rate of the US dollar. The price of crude oil reflects a more interactive relationship. The rise in crude oil prices will affect the world economy, including the United States, the world's largest oil consumer. The inflation pressure brought by the rise of crude oil price will bring devaluation pressure to the US dollar, and the direct consequence of the depreciation of US dollar is that the price of crude oil priced in US dollar will also rise accordingly.

3. According to experts' estimation, the correlation coefficient between crude oil price and dollar exchange rate is - 0.7, that is to say, high oil price often appears simultaneously with weak dollar. One of the major manifestations of the current global economic imbalance is that the United States has a double deficit pattern of huge fiscal deficit and current account deficit, and the U.S. dollar has a trend of significant depreciation in the medium and long term. If the expectation of US dollar depreciation can not be eliminated, the high international crude oil price pattern is expected to continue.

The above is about the relationship between the US dollar exchange rate and the price of crude oil, I believe you have some understanding~

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