Crude prices have risen by nearly US $ 65 or 92.85 % in one year

Crude prices have risen by nearly US $ 65 or 92.85 % in one year on a point-to-point basis. Crude which was selling at US $ 70 in May 2007 is now selling at US $ 135 in May 2008.

Most economies are likely to witness significantly pressures as essential commodities items like rice, wheat, dal, etc have a direct co-relation between the supply of fuel costs and selling prices. The essential items prices are likely to increase as the fuel cost for transportation increases. If transportation cost increases, then inflation rises. Other sectors like cement, steel, metals, engineering, aviation, manufacturing also are impacted directly or indirectly.

Most marketmen are of the view, that crude could touch in upwards of 170-180. If the same happens, will most economies be able to sustain the hits in terms of basic petroleum products. If not, then is this the right time to short the crude futures.