As worries about the economy and consumer confidence ebb and flow and supply reports fluctuate, oil and natural gas exchange traded funds (ETFs) are being taken for a similarly wild ride.
These commodities sure are sensitive these days.
In the past six months, oil has plunged twice, but bounced back quickly, Kurt Brouwer for MarketWatch points out. Now, oil prices have dropped well below their 50-day moving average, with prices around $70 a barrel.
Oil has weakened in the past few weeks partly due to concerns over economic growth in Europe, China and the United States. Furthermore, the outlook for inflation this year is moderate and the economic outlook is looking soft, which translates to a subdued interest in oil. [Commodity ETFs Take It On The Chin.]
Natural gas prices, on the other hand, have moved past their 50-day moving average, with prices now wobbling around $4. Energy analysts also point out that supply and demand fundamentals are weak, writes Jason Womack for The Wall Street Journal.