| Oil prices rose about 5% last week to finish only a dollar short of regaining triple-digit status. Since dipping below $80 per barrel on Oct. 3, West Texas Intermediate (WTI) prices have increased almost 28%. This increase is nearly twice that of the S&P 500 Index, up 15% since Oct. 3, but reinforces a recent trend for oil prices – as equities go, so goes oil.
The EIA says “the recent strong relationship between oil and equity prices resembles that seen during the economic downturn and recovery in 2008-2010.” According to EIA data, crude oil and the S&P 500 Index have had a positive correlation in 12 of the past 13 quarters. A positive correlation had not occurred once in the previous 35 quarters. In fact, crude oil and equities experienced a negative correlation during five quarters over that time period.............................................Full Article: Source
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