Oil prices are having a good day today on optimism regarding a potential production cut at the OPEC meeting later this month. Since the election just under two weeks ago, the price of WTI crude oil has rallied just over 4%, so it hasn’t been a major move in either direction nor one that companies who use a lot of oil (like airlines) would be overly concerned about at this point.
While oil prices haven’t seen much of a move in dollar terms, because of the dollar’s rally, prices have been rising a lot faster in other currencies causing a bit more pain for consumers of the commodity in those countries. The chart below shows the change in the price of WTI crude oil since Election Day for a number of major currencies. At this point, the only currency where prices have risen less than they have in dollar terms is in British pounds. For every other currency shown, prices have been rising at a faster rate. In euro terms, WTI is up nearly 400 basis points (bps) more at 8.6%, while consumers in Australia, Japan, and Brazil are facing price increases of 10%. Priced in gold too, WTI is up just over 10%. In Mexico, though, the pain has been the greatest, as the plunge in the peso following Trump’s election, has pushed the price of WTI up over 16% when priced in pesos.