The increase in oil prices can raise the price of corn and soybeans
on Monday the price of Brent crude oil increased by 3.9% and reached the highest since November 2014 level 81,47 $/barrel. The reason for the growth was the introduction by the US government sanctions against Iran the refusal of exporters to increase production, which can lead to a shortage of supply of oil.
Saudi Arabia, leader of OPEC, which includes the main countries-exporters of oil, and Russia, which is not included in the group, however, occupies leading positions in the world's oil, has refused to increase production. An official decision on increasing the oil production at the OPEC talks+ was not accepted.
Traders believe that as a result of the insolvency of Saudi Arabia to meet the demand which is constantly growing, world oil prices in the near future may increase to 90-100 $/barrel. This will lead to a rise in price of gasoline in the US and will adversely affect the economy of the country.
on the other hand, the rising oil prices will support corn prices and vegetable oils used for the production of ethanol and biodiesel. A record harvest of corn and soybeans in the United States and the introduction of China and EU import duties have fallen off the price of soybeans to a 10-year low, so the increased consumption by domestic refiners could stop prices drop and deploy price trends.