Rising oil prices often depress the value of the U.S. dollar, but political instability in Libya and other countries is likely to buoy the U.S. currency, said Daniel Yergin, chairman of IHS Cambridge Energy Research Associates.
Rising oil prices often depress the value of the U.S. dollar, but
political instability in Libya and other countries is likely to buoy the U.S.
currency, said Daniel Yergin, chairman of IHS Cambridge Energy Research
Associates.
Ongoing unrest in
Africa
and the
Middle
East
will serve to strengthen the dollar because investors tend to flock to
the
U.S.
currency in times of geopolitical instability, Yergin during an interview with
the Wall Street Journal's Big Interview set to air Friday.
"We've seen this kind of strange dance that goes on between [the]
weakening dollar and strengthening oil prices, and vice versa," Yergin
said. "But we're in a different kind of situation now. When you have
geopolitical risk, people like holding the dollar."
The political unrest in Libya, a member of the Organization of the Petroleum
Exporting Countries, or OPEC, is also stirring concerns over global oil
supplies and that should boost the value of currencies in other oil-producing
countries, Yergin said.
The Russian ruble, for instance, "is quite strong now because of
that," he said.
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